PARIS, Jan 22 (Reuters) - French bank Credit Agricole on Monday disclosed a 7% equity stake it holds in payment services provider Worldline, saying the move was part of a wider strategic partnership to forge a 'major player for commercial payment services in France.'

The bank added that work towards creating a previously announced planned joint venture between the companies was well on track, with operations seen starting in 2024.

Worldline said in a separate statement that it welcomed the investment, which it called 'a testament to the strategic evolution of the European payment market'.

Reuters

reported last week that Worldline has lined up bankers to advise on a defence strategy to reassure shareholders and avoid a hostile takeover in the wake of a share price slump, with Worldline shares down around 16% so far in 2024.

Credit Agricole's plans to buy a sizeable chunk of Worldline shares to stabilize its struggling partner were reported last

December

, making the company's shares surge on the Paris stock exchange, although Worldline shares still fell 57% in 2023.

During the last week the advisers started sounding out other potential investors, such as French financial institutions, pension and sovereign wealth funds, about taking a minority stake in the group, Reuters had reported.

The proposed tie-up between Credit Agricole and Worldline aims to tap the 700 billion euros ($767.6 billion) of merchant sales in France, the companies had said last spring, as customers increasingly move from cash to card payments. (Reporting by Tassilo Hummel; Editing by Sudip Kar-Gupta)