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Wednesday, July 5, 2017

Vantiv to acquire Worldpay

Leading U.S. acquirer Vantiv is merging with Worldpay Group, the largest payment processing company in the United Kingdom, in a deal valued at nearly $10 billion. “The potential merger creates a scale world class payments group in a dynamic market, with deep payments capabilities, product and vertical expertise and strong distribution channels to serve merchants around the world in the global ecommerce market, and in-store and online in the UK and US markets,” the two companies said in a joint statement released on July 5, 2017.

The deal is set to be completed by Aug. 1, pending shareholder and regulatory approvals. No mention of which, if either, name will survive the merger, although the distribution of board of director seats favors Vantiv by three.

“To ensure a successful and smooth integration,” the merged company will retain the current chief executive officers of Vantiv and Worldpay. Vantiv CEO Charles Drucker and Worldpay CEO Philip Jansen will be co-CEOs; Drucker has been assigned the additional title of Executive Chairman.

The proposed deal with Worldpay marks Vantiv’s second major acquisition in less than a year. Late in 2016 the company acquired Moneris USA for $425 million. That deal added nearly 350,000 merchant accounts to the company’s merchant portfolio, bringing its total portfolio to over 1.1 million accounts.

Worldpay, headquartered in London, claims a merchant acquiring presence in 146 countries, including in the United States, where it operates as Worldpay US. The company is said to process over 40 percent of all merchant card transactions in the U.K.

Worldpay originated as part of the Royal Bank of Scotland. But the big Scottish bank was forced to sell off the profitable payment processing unit in 2010 as part of a bail-out agreement negotiated with the European Commission. That resulted in Worldpay being purchased by a pair of private equity firms – Advent International and Bank Capital – for about $5 billion. Five years later, Worldpay raised $7.4 billion in what was billed at the time as largest IPO of the year on the London Stock Exchange.

A few days before heralding the merger with Vantiv, Worldpay revealed it had been approached by two potential buyers, Vantiv and JPMorgan Chase. JPMorgan has since said it took a pass on the deal. end of article

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