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Worldline weighs asset sales to shore up investor confidence -sources

FILE PHOTO: Worldline logo at the company headquarters in the financial and business district of La Defense

By Amy-Jo Crowley, Mathieu Rosemain and Pablo Mayo Cerqueiro

LONDON/PARIS (Reuters) - French digital payments company Worldline is considering options including asset sales as part of efforts to reassure shareholders after a sharp drop in its share price, three people familiar with the matter said.

The company lost more than half its market capitalisation in late October and sent ripples across the sector after it cut its full-year financial targets, citing the economic slowdown and heightened scrutiny over money-laundering risks in Germany.

The most likely disposals could come from Worldline's Mobility division, home to digital payment solutions for ticketing services, one of the people said.

Another said assets sales may come from its software businesses but suggested these might not be sizeable enough to revitalise its shares.

Worldline declined to comment.

The potential asset sales are part of discussions being held with shareholders, two of the people said, as Worldline looks to follow Dutch rival Adyen in appeasing at least some market concerns by setting "more realistic" targets.

The steep fall in Worldline's share price has made it vulnerable to a potential takeover, piquing the interest of U.S. rivals and private equity firms, the first person said.

This has raised concern within the French government, which is closely monitoring the situation and would favour a French-led offer for Worldline, a source familiar with the government's thinking said.

French lender Credit Agricole SA, already an existing partner of the payments firm, is looking at potentially buying shares in the company, a fourth person familiar with the matter said.

Other French banks could also partner with Credit Agricole for a role in Worldline's future, this person added.

Bloomberg first reported Credit Agricole's interest in buying a stake in Worldline, prompting its shares to soar by almost 12% earlier on Friday.

Credit Agricole declined to comment.

"This rumour should not surprise the market, it is not breaking news that payment companies are attractive at these levels," said Tommaso Nieddu, an analyst at AlphaValue, on Credit Agricole's potential interest.

"This interest puts a floor on the valuation, but I am doubtful that without more information, it will be sufficient to drive the company's valuation higher."

(Reporting by Amy-Jo Crowley, Mathieu Rosemain and Pablo Mayo Cerqueiro; Additional reporting by Diana Mandiá Álvarez and Gaëlle Sheehan; Editing by Kirsten Donovan)