MasterCard closes in on £1bn VocaLink acquisition
MasterCard is in “exclusive” talks with VocaLink over a £1 billion-acquisition, according to Sky News.
Sky News says it has learned that 13 banks, which are shareholders in VocaLink, have “approved a period of exclusivity within which MasterCard can negotiate a takeover of the company”.
Out of those banks, Barclays, HSBC, Lloyds Banking Group and Royal Bank of Scotland, own about 80% of VocaLink. If the sale goes through, the four of them will receive a handy windfall.
As Banking Technology reported in March, MasterCard was mulling the purchase of the UK’s payments infrastructure.
This followed the Payment Systems Regulator (PSR) telling banks in February they should sell their stake in VocaLink to “help increase innovation and competition”.
According to David Bannister, financial services analyst at Ovum (and former editor at Banking Technology), there have been rumours for some time that other companies were trying to buy parts of the VocaLink business.
He notes, however, that “while the proposal makes sense for MasterCard, it doesn’t make much sense in terms of the PSR agenda: unless the core processing of Faster Payments Service and Bacs is hived off to another player, or MasterCard only takes that part, the status quo is essentially unchanged”.
VocaLink processes over 90% of salaries, more than 70% of household bills and almost all state benefits.
SIA, an Italian payments group, and a number of private equity firms had also expressed an interest in acquiring the British company.