Worldpay and Vantiv agree terms on £9.3bn merger

Worldpay’s chief Philip Jansen

USA credit card processing company Vantiv secured a deal to buy British-based rival Worldpay for 8 billion pounds ($10.4 billion) on Wednesday in a bid to create a $29 billion global payments powerhouse.

There was no word on possible redundancies, although this is highly likely as the combined company will have annual recurring pre-tax cost synergies of approximately $200m, and there is expected to be a "one-off restructuring and integration costs of approximately $330m". Worldpay will be familiar to many as a big player in payments in the United Kingdom and also U.S. and elsewhere.

SoftBank Group Corp is investing $1 billion in Fanatics Inc as a part of a funding round that values the sports e-commerce company at $4.5 billion, according to sources familiar with the matter.

The deal, which was first announced on July 5, took several weeks of negotiations with the deadline for a formal offer being extended twice, as the two companies haggled over the location of the combined group and ways to safeguard United Kingdom jobs.

Cincinnati, Ohio will become the company's global and corporate headquarters and London, U.K. will become its worldwide headquarters.

The new Worldpay will also be listed on the New York Stock Exchange with a secondary listing in London. The "combination of scale, innovation, technology and global presence will mean that we can offer more payment solutions to businesses, whether large or small, global or local".

Payment processing giant Vantiv has sealed its deal to acquire London-based processing rival Worldpay.

Jansen said: "The growth of eCommerce and the way consumers expect to transact is increasing complexity for businesses around the world".

Vantiv CEO Charles Drucker will lead the combined company as executive chairman and co-CEO. Stephanie Ferris to be CFO, both will report to Charles Drucker.

"Vantiv now has to figure out how to integrate another 400,000 Worldpay merchants on the heels of several other acquisitions", said Brendan Miller, principal analyst at Forrester. This values United Kingdom -based Worldpay at £9.3 billion ($12 billion) and the new combined company - which will go by the name of Worldpay - at an enterprise value of £22.2 billion ($28.8 billion).

The Danish payments firm Nets A/S also announced that it had been approached, without disclosing the identity of the organisations looking to strike a deal, however the likes of Visa and Mastercard were rumoured to be involved.

Related News: