Vantiv Swallows Mercury Payment Systems in $1.65 Billion Deal (May 14, 2014)
Mercury Payment Systems Inc.’s IPO plans came to a screeching halt when Vantiv Inc. on May 12 announced a deal to acquire Mercury for $1.65 billion. Durango, Colo.-based Mercury, launched by two brothers in 2001, provides transaction processing services and customized POS software for various merchants types, sold via a network of 3,000 dealers and resellers. Cincinnati-based Vantiv, the nation’s third-largest merchant acquirer, will gain Mercury’s software and POS technology muscle for mobile and omnichannel payments, plus its broad market reach into diverse market sectors through an independent sales organization model, observers say. Technology investment firm Silver Lake in 2010 bought a majority stake in Mercury, and Vantiv will finance its purchase through debt, the company said. The deal is expected to close June 30.
The deal came as a surprise to the investment community, but apparently as Mercury laid the groundwork for its IPO, its impressive growth and in-house technical prowess drew Vantiv’s interest. Mercury says it will withdraw its IPO registration statement in the wake of the acquisition agreement.
In just over a decade Mercury grew to become the nation’s 11-largest merchant acquirer with 2013 revenues of $237 million, up 17 percent from the previous year. Mercury’s cloud-based software apps and technology are geared be flexible and easily integrated with existing POS systems, the companies said. “The emergence of integrated payment technology at the point of sale delivers a differentiated merchant experience and creates a highly efficient, cloud-based delivery model for customer acquisition and retention,” said Charles Drucker, Vantiv president and CEO, in a press release.
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