Just one day after Worldpay announced it was entertaining acquisition offers from two financial services giants, the e-commerce processor and acquirer made a second announcement that it had agreed in principle with one of them. Payments processor Vantiv and Worldpay today unveiled an agreement under which Cincinnati-based Vantiv will pay £7.7 billion (nearly $10 billion) for the U.K. company. Vantiv inherits Worldpay’s 400,000 merchant customers in 146 countries, notably the U.K., where it holds a dominant position.
“The Boards of Worldpay and Vantiv see compelling strategic, commercial and financial rationale for combining Worldpay and Vantiv’s complementary businesses,” Worldpay said in a statement. “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 e-commerce market, and in-store and online in the U.K. and U.S. markets.”
While Worldpay noted scale in its statement, maps may have played a more important role in this pairing than size, Thad Peterson, senior analyst for Boston-based consultancy Aite Group, told CardNotPresent.com
“I don’t think this is about scale, since both organizations are already scaled,” Peterson said. “It’s more about geographic reach and the leverage of Vantiv’s strengths in new markets. This [merger] makes sense for both organizations since Vantiv is powerful in the U.S. and Worldpay has a significant presence in Europe and elsewhere around the globe. The deal gives Vantiv an opportunity to further leverage its e-commerce portfolio that was created with the acquisition of Mercury and Litle.”
Current Vantiv CEO Charles Drucker will serve as executive chairman and co-CEO of the combined company. Current Worldpay CEO Philip Jansen will be the other co-CEO of Vantiv after the acquisition has been completed.