Vantiv seals $10 billion Worldpay acquisition
Vantiv Inc. agreed to acquire U.K. payments processor Worldpay Group PLC for about GBP8 billion ($10.4 billion) in cash and stock, one of the biggest deals in the fast consolidating sector.
The tie-up, according to a joint statement Wednesday, will create a trans-Atlantic payments processing giant with a combined market value of more than $20 billion. The companies disclosed their negotiations last month as the Ohio-based Vantiv appeared at the time to ward off a potential rival bid from J.P. Morgan Chase & Co. The combined entity will be called Worldpay.
Payments businesses are under pressure to join forces in part to cut costs as greater regulatory scrutiny and rising competition from technology startups squeeze the fees of incumbents. In April, Mastercard Inc. received regulatory approval to acquire payment-technology firm VocaLink Holdings Ltd. for about $920 million. Last week, Atlanta-based Global Payments Inc. agreed to acquire certain cloud-based payment technology of Active Network for about $1 billion from private-equity firm Vista Equity Partners.
At the same time, buyout firms, which typically cash out of investments within a fixed period, are also driving a lot of the deal activity. As businesses and consumers increasingly use mobile devices to transfer money, private equity firms are betting the appetite for providers of secure online payment services will remain strong.
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