August 11, 2017
By: Steven Anderson
Not long after the fireworks haze had settled from the Fourth of July festivities, we got word that Vantiv had its eyes on picking up Worldpay, the British payment processing firm. Now, the eyes have it as Vantiv made a formal offer for Worldpay, valued at eight billion pounds sterling, or around $10.38 billion US as of this writing.
Vantiv is just part of a growing trend of mergers and acquisitions in the payments field, taking advantage of the likewise growing trend that is mobile payments itself. We’ve seen a host of deals emerge from Alibaba’s financial arm Ant Financial, as well as Ingenico’s purchase of Bambora and Paysafe Group’s takeover offer from an investment group led by Blackstone, among others.
The Vantiv / Worldpay deal itself, meanwhile, took over a month to materialize thanks to some comparatively minor issues, as the two discussed governance as well as protective measures for British jobs. Reports note that the combined firm will keep the Worldpay name, with its headquarters now in Cincinnati, a “primary listing” in New York and a “secondary” listing in London.
The deal still seems to be a sound one for Vantiv, as the combined company is projected to process around $1.5 trillion in payments over 40 billion transactions, which would ultimately yield a combined net revenue of $3.2 billion, reports note. That’s around three and a half years’ net revenue, which isn’t exactly terrible for a major purchase.
Thankfully, Vantiv’s way forward on this project seems to have gone smoothly, much more smoothly than some feared it might. The reports of JPMorgan Chase potentially taking an interest seem to have gone nowhere, and Vantiv successfully set up a deal that will give it a lot of new capability in the market. We all know mobile payments are a big deal—we see enough developments in this field daily right here to know that much is true—so developments like these not only drive individual firms, but the entire field as competitors push to match the companies with the new developments.
Vantiv’s offer is likely to be accepted, as the pair together would likely end up stronger than either separately. This is a rapidly changing market, and strength in the field will ultimately be necessary to ongoing survival.