Euro Deals Update: Visa Europe Sale Gets Final OK; Global Payments Completes New JV
The European Commission has granted final approval to Visa Inc.’s planned acquisition of Visa Europe, with the transaction expected to close by the end of this month, Visa Inc. announced. The purchase agreement initially was reached in November 2015, with the sale price set at up to €21.2 billion (US$24.1 billion), but the deal hit a snag when EU regulators called for Visa Inc. to pony up more cash up front and reduce future payments to Visa Europe.
In April, Visa Inc. amended terms of the acquisition, increasing its upfront payment by €750 million (US$852 million). With the amended offer approved, the transaction is expected to close by the end of Visa Inc.’s fiscal third quarter—the originally scheduled date—bringing the entities together for the first time since 2007. More than 3,700 European banks and payment services providers banded together to form Visa Europe, a membership association, after splintering off from Visa Inc. prior to Visa Inc.’s IPO.
In other European payments news, payments technology firm Global Payments Inc. and CaixaBank, Spain’s largest bank, have formed a joint venture with financial services provider Erste Group Bank AG to launch a new merchant acquiring and payment services business in the Czech Republic, Slovakia and Romania. Under the terms of the agreement, Global Payments and CaixaBank hold a 51 percent majority interest in the joint venture, while Erste Group holds the remaining 49 percent.
Global Payments made a splash in the U.S. processing market late last year, when the Atlanta-based company agreed to purchase Heartland Payment Systems Inc. for $4.3 billion. That acquisition—which gave Global Payments entrée into several new verticals, including fuel retailers, colleges and hospitality—closed in April.