Banking News

Mastercard to aquire UK payment processing firm VocaLink

(22 July 2016 – United Kingdom) MasterCard Inc has announced that it will acquire 92.4 percent of VocaLink Holdings Limited for about £700 million (around A$1.23 billion).

The figure is £300 million less than Mastercard was reported to have offered the London based firm in March.

In a statement, the New York-based payment service provider said VocaLink’s existing shareholders have the potential for an earn-out of up to an additional £169 million, if performance targets are met.

Under the agreement, a majority of VocaLink’s shareholders will retain 7.6 percent ownership for at least three years.

VocaLink operates key payments technology platforms on behalf of UK payment schemes, including:

• BACS – the Automated Clearing House (ACH) enabling direct credit and direct debit payments between bank accounts
• Faster Payments – the real-time account-to-account service enabling payments via mobile, internet and telephone
• LINK – the UK ATM network

In addition, VocaLink offers innovative products with global potential, including ZAPP, a mobile payments app that leverages Fast ACH technology, and licenses its software and provides services to support ACH activities in Sweden, Singapore, Thailand and the United States. In 2015, the company reported revenues of £182 million as it processed more than 11 billion transactions.

MasterCard said that the acquisition accelerates its “efforts to be an active participant in all types of electronic payments and payment flows and to enhance its services for the benefit of customers and partners.”

“We’re excited about the opportunity to play a bigger role in payments in the UK, a very strategic market for us,” said Ajay Banga, president and CEO, MasterCard.

“VocaLink is a unique company with outstanding technology, assets and people. We look forward to investing in and maximizing the technology, and embedding it in our products and solutions, both in the UK and around the world.”

David Yates, CEO VocaLink said: “Today’s announcement is positive news for our partners, customers and employees.

“We will continue to focus on ensuring that the UK systems perform seamlessly, maintaining the highest levels of quality. At the same time, we’ll invest in further innovation to power competitive payments solutions for consumers and businesses around the globe,” he added.