After months of speculation and concerns last week that the deal might not come through, it seems Visa’s plan to acquire Visa Europe will make it over the finish line after all.
The two companies announced in a statement this morning a definitive agreement for Visa Inc. to acquire Visa Europe, creating a single global company. The deal’s total top value will be €21.2 billion, or $23.4 billion — outstripping the average analyst estimate of $21 billion. That will mean $18.2 billion in upfront considerations and $5.2 billion payable following the fourth anniversary of closing.
"We are very excited about unifying Visa into a single global company with unmatched scale, technology and services,” said Charles W. Scharf, chief executive officer of Visa Inc. “This transaction is beneficial for financial institutions, acquirers, merchants, cardholders and other partners, as well as for our employees and shareholders. The Visa Europe team has done a tremendous job building a leading payments system that is trusted and respected across Europe, and together we will bring the power of electronic payments to more people, in more places, than ever before."
Both companies’ boards unanimously supported the acquisition.
“Integrating into one global business will ensure we have the financial strength and operational scale necessary to accelerate the next generation of payments throughout Europe. This will enable us to deliver world class solutions to our clients and open up exciting professional opportunities for our employees,” noted Nicolas Huss, CEO of Visa Europe.
“Visa is a great global brand with a proud history and exciting future. Visa Europe has delivered impressive results over recent years, and the board believes that it is the right time to reunite these two very healthy businesses under common management. The deal will unlock significant value for members, both through the consideration paid and because the board believes a combined Visa will be better positioned to serve the needs of customers going forward. We are confident that Visa Inc. is committed to long-term investment and development of the European business,” said Gary Hoffman, chairman of the Visa Europe board.
The deal follows concerns about the fate of the deal following a Seeking Alpha article last week that suggested that sell-side firm Evercore ISI had posited that the acquisition of Visa Europe by its former parent, Visa, may not take place — or if it does, it would be smaller than rumors from earlier in 2015.