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The Green Sheet Online Edition

November 28, 2016 • Issue 16:11:02

Vantiv growth plans to include Moneris USA

Vantiv Inc.'s planned acquisition of Moneris USA for $425 million is the latest conquest for the Cincinnati-based payments acquirer. The deal, expected to close in the fourth quarter of 2016, will be subject to final approval and anti-trust clearance by the U.S. Department of Justice. Schaumburg, Ill.-based Moneris USA, a subsidiary of Moneris, a Canadian company jointly owned by BMO Financial Group and Royal Bank of Canada, processed nearly $12 billion in payment transactions in 2015, Moneris reported.

Payments analysts expect an easy transition due to the companies' aligned interests and compatible organizational cultures. The chief executives expect the merger to combine and leverage areas of technical and marketing expertise. Charles Drucker, President and CEO at Vantiv, said the Moneris USA acquisition will accelerate the company's growth in key channels. "We look forward to serving [Moneris USA] technology and banking sector partners with our deep payments expertise and strong customer service," he added. Angela Brown, President and CEO at Moneris, also expects Moneris USA merchants to benefit from Vantiv's high level of service, economies of scale and omnichannel capabilities. "Working together with Vantiv, Moneris will continue to support our mutual cross-border customers with a focus on innovation and service," she said.

Vantiv growth, profitability

Vantiv, one of the largest acquirers in the United States, has a portfolio of 800,000 merchants and 1,400 financial institution partnerships. The publicly traded company reported a 12 percent increase in total revenue ($914 million) for the third quarter of 2016, compared with the same period in 2015 ($816 million). Company leaders attributed positive earnings to organic growth. "Our ability to deliver superior financial results by consistently winning market share speaks to the strength of our people and their consistent focus on execution," Drucker said.

Following are additional details from Vantiv's third quarter 2016 earnings report:

  • Merchant services: Net revenue increased 17 percent to $404 million, compared with $345 million in the same period in the prior year, with a 10 percent increase in transactions and a 6 percent increase in net revenue per transaction.
  • Financial institution services: Net revenue increased 1 percent to $86.2 million in the third quarter, compared with $85.6 million in the third quarter of 2015. The company renewed its contract with Fifth Third Bank during this period, impacting short-term profits but favorably positioning the company for long-term growth in the channel.

Moneris contactless, EMV leadership

Moneris, a leading North American payment solutions provider, provides credit, debit, wireless and online payment services for merchants across an array of industries, processing more than 3 billion transactions a year. The company has more than 350,000 merchants and is known for its value-added loyalty and gift card services.

Moneris has advanced mobile wallet adoption by deploying near field communication-enabled POS devices. In May 2016, it disclosed that Apple Pay would be available at select retailers for Visa Inc., Mastercard, American Express Co. and Interac Debit cardholders. Rob Cameron, Chief Product and Marketing Officer at Moneris said all of the company's solutions support contactless payments, noting 25 percent of transactions originate from mobile devices or contactless credit cards. "With Apple Pay's increased options and our leading market share in Canada, we are ready to educate, enable and support merchants across the country to accept Apple Pay today," he said.

The company was also a leader in U.S. EMV (Europay, Mastercard and Visa) migration, partnering with POS software developer Amber Systems Technologies to be EMV-certified with all five payment card brands. Amber Systems' expertise in the restaurant, specialty retail and grocery segments streamlined EMV acceptance for numerous hospitality retailers and supported Moneris in its phased rollout of EMV compliant devices across the United States, the company reported in February 2016.

In addition, Moneris brought a decade of EMV experience to bear during the October 2015 liability shift, helping U.S. merchants upgrade POS systems to EMV-capable solutions. Merchants appreciated the company's proven track record in EMV deployments, noted Chris Lee, the company's President of North American Strategic Partnerships and Emerging Markets. "We manage every aspect of the EMV migration and integration process, from design and testing, to certification and implementation, making the switch to EMV a seamless transition for merchants," she said.

Rumors of the merger had been circulating for close to a year, according to Jay Antenen, Senior Editor at The Mergermarket Group. When the news became official on Nov. 10, 2016, he tweeted, "Vantiv finally wins Moneris USA for $425m. Long sale process had lots of fits and starts, rumors." end of article

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