Visa to buy back Visa Europe for €21.2 billion

Visa Logo on top of map of Europe

Following July’s story that reported Visa was in serious talks to re-acquire former subsidiary Visa Europe, the payments technology giant has reached a definitive agreement to acquire Visa Europe, creating a single global company.

 

Reunited 

Although the two companies share the same name, they have not been associated for nearly ten years, since Visa launched an initial public offering back in 2007.

The transaction consists of upfront consideration of €16.5 billion with the potential for an additional earn-out of up to €4.7 billion payable following the fourth anniversary of closing, for a total value of up to €21.2 billion. The upfront consideration comprises €11.5 billion of cash and preferred stock convertible into Visa class A common stock valued at €5 billion.

The reunion will adds approximately 3,000 European issuers, over 500m card accounts and more than €1.5 trillion in payments volumes to Visa’s portfolio.

“We are very excited about unifying Visa into a single global company with unmatched scale, technology and services. This transaction is beneficial for financial institutions, acquirers, merchants, cardholders, and other partners, as well as for our employees and shareholders,” said Charles W. Scharf, chief executive officer, Visa Inc.

He went on to stress that Visa’s efforts are adjusted and tailored to “meet local market needs”. This, he says, includes being responsive to the evolving regulatory landscape, maintaining a European data center, and partnering with Europe’s growing payments ecosystem to co-develop locally-relevant products, services and experiences.

 

MasterCard

The acquisition will give Visa a major boost in its rivalry with MasterCard. which drew over a quarter ($228 billion) of its $852 billion in purchase volume from Europe.

Nicolas Huss, CEO Visa Europe added: “Integrating into one global business will ensure we have the financial strength and operational scale necessary to accelerate the next generation of payments throughout Europe. This will enable us to deliver world class solutions to our clients and open up exciting professional opportunities for our employees.”

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