US credit card processing company Vantiv secured a deal to buy British-based rival Worldpay for 8 billion pounds (US$10.4 billion) in a bid to create a US$29 billion global payments powerhouse.
Vantiv’s move, one of the biggest takeovers of a British firm since last year’s Brexit vote, is part of a wave of payments company mergers as consumers move away from cash transactions to digital payments, Reuters reports.
Companies such as Vantiv with a strong presence in the United States are scrambling to establish a global footprint in the fast-evolving payments industry.
Once a backwater of banking, the sector is now both lucrative and fast-growing, but also faces competition from newcomers trying to disrupt the way merchants are paid.
Shares in Worldpay, Britain’s biggest payment provider, closed 1.28 percent higher at 388.5 pence after Wednesday’s announcement of the deal, which marks the second biggest takeover of a British company this year after China Investment Corporation’s US$13.8 billion purchase in June of London-based warehouse firm Logicor.
Other recent deals in the payment sector include Britain’s Paysafe Group backing a 3 billion pound takeover offer from a consortium of Blackstone and CVC Capital Partners and French payments specialist Ingenico making a 1.5 billion euro (US$1.76 billion) swoop on Swedish rival Bambora.
Although Vantiv’s deal was first announced on July 5, it has taken several weeks to conclude, with the deadline for a formal offer extended twice as Vantiv and Worldpay haggled over governance and safeguarding British jobs.
The combined Worldpay and Vantiv, which were both spun out of banks and have thrived in their home markets, will be called “Worldpay” and headquartered in Cincinnati, with a primary listing in New York and a secondary one in London.
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