MasterCard Jumps into UK Payments Technologies, Buys VocaLink for up to $1.14B

by Sarah Grotta 0

The long discussed acquisition of VocaLink by MasterCard appears that it will actually happen. For MasterCard, there are some clear benefits. It strengthens MasterCard’s presence in several non-U.S. locations and broadens its breadth of product to include more non-card based solutions. TechCrunch reported:

Today, MasterCard Inc. announced that it has agreed to acquire 92.4% of VocaLink — the tech giant behind the UK’s ATM, direct debit, and major mobile payments networks — for $1.14 billion in an all-cash deal: £700 million ($920 million) initially, with the potential for an earn-out of up to an additional £169 million (approximately US$220 million), also in cash, if performance targets are met. The remaining 7.6% of the company will continue to be owned by VocaLink’s shareholders for a period of at least three years, said MasterCard in its announcement

In addition to the ATM network, ACH capabilities and faster payments expertise MasterCard will also acquire a mobile app capability that interestingly enough, not reliant on card networks:

… ZAPP, a mobile payments app leverages Fast ACH technology; and it also licenses its software and provides services to support ACH activities in Sweden, Singapore, Thailand and the United States

Overview by Sarah Grotta Director, Debit Advisory Service at Mercator Advisory Group

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