Visa Considers Acquisition of Visa Europe (July 27, 2015)
Visa Inc. has confirmed it’s in negotiations to acquire Visa Europe. Though Visa hasn’t discussed details, some reports suggest the deal could be in the range of $10 billion to $20 billion.
“Visa Inc. believes there is compelling logic for both Visa Inc. and Visa Europe to consummate a business combination and therefore regularly engages in such discussions and is currently in such discussions with Visa Europe,” Visa said in its third quarter earnings report last week. “The company is targeting to resolve these discussions by the end of October and will provide an update during the fourth quarter earnings call, if not sooner. There is no assurance, however, that any transaction will be ultimately agreed or implemented.”
Visa Inc. and Visa Europe are separate, independently operating companies, with Visa Europe operating in Europe with an exclusive, irrevocable license. The two companies have operated this way since 2007, prior to Visa becoming a publicly traded company.
“Bringing Visa Europe back into the Visa Inc. business would enable Visa to better compete for global business,” says David Parker, founder and CEO of U.K.-based Polymath Consulting. “Plus, as the world goes more digital and innovation becomes ever more important, the ability to leverage [company resources] more effectively without any intercompany issues will be key to technology developments.”