By Barry Eitel
SAN FRANCISCO (AA) – Payments processer Vantiv announced Wednesday it has acquired UK-based Worldpay for $10 billion.
The combined company that will be called Worldpay, will be a $29 billion powerhouse in a market that is growing rapidly.
A payments processor is a third-party company that processes credit and debit card payments with banks for businesses.
“This is a powerful combination that is strategically compelling for both companies,” Charles Drucker, Vantiv’s chief executive, said in a statement.
“It joins two highly complementary businesses, and it will allow us to achieve even more together than either organization could accomplish on its own,” he said. “Our combined company will have unparalleled scale, a comprehensive suite of solutions and the worldwide reach to make us the payments industry global partner of choice.”
While many banks used to process payments themselves, the work is increasingly being left to other firms. Vantiv and Worldpay were spun out of banks.
The new Worldpay expects to process $1.5 trillion in payments every year across the globe. The company will be available in 146 countries and in 126 currencies.
Drucker will lead the new company, with Worldpay’s current CEO Philip Jansen directly under him in a co-CEO position. The new company will be headquartered in Cincinnati, Ohio, but listed on stock markets in New York City and London.
"This is a merger of two world-class payment companies, which will create a global omni-commerce leader, with substantial opportunities to capitalize on the rapid evolution of payments," Jansen said in a statement.
Pending regulatory approval, the deal is expected to close early next year. While Vantiv first approached Worldpay with an offer in early July, it took more than a month for the two companies to reach a deal.
Shares of Vantiv rose more than 3 percent on the news to close at $67.10.