Payments: Acquirer acquired
An American payments firm goes online and buysBritish.
A Bidding war was briefly but eagerly anticipated. In the end, not a shot was fired.
On July 4th the share price of Worldpay, a British payments processor, leapt by 28% after thecompany said it had received preliminary approaches from JPMorgan Chase, America's biggestbank, and Vantiv, an American payments firm.
The next day Worldpay said it had accepted a cash-and-shares bid from Vantiv, worth 7.7bnpounds ($10bn) , giving its shareholders 41% of the combined group.
JPMorgan Chase, sniffily explaining that it had considered a bid after an “invitation” fromWorldpay, which is a client, declined to proceed.
Under Britain's takeover code that refusal rules out a counter bid for six months.
The shares slipped back by nearly 9%.
Vantiv and Worldpay are “merchant acquirers” : companies that have contracts with sellers ofgoods and services, and licences from credit- and debit-card companies, to accept and processcard payments.
They also provide insurance—for example, refunding disappointed holidaymakers when anairline goes bust.
Until a few years ago, explains Ali Farid Khwaja of Autonomous, an investment-research firm, acquirers in both America and Europe had to have banking licences.
直到几年前，自治的Ali Farid Khwaja解释道，一家投资研究公司，要求在美国和欧洲的收购者都必须拥有营业执照。
As a consequence, banks still feature in lists of leading acquirers.
According to the Nilson Report, a newsletter, they accounted for three of America's top sevenlast year: JPMorgan Chase ranked first, with Vantiv second.
Both Vantiv and Worldpay, indeed, emerged from banks.
事实上，Vantiv 和 Worldpay都来自银行。
Vantiv was spun off in 2009 by Fifth Third, an Ohio-based lender which still owns 17.9%.
The European Commission obliged the Royal Bank ofScotland to sell Worldpay in 2010, as a condition ofRBS's bail-out by the British state after the financialcrisis.
欧盟委员会(European Commission)要求苏格兰皇家银行(Royal Bank of Scotland)在2010年出售Worldpay，作为苏格兰皇家银行在金融危机后对英国政府的救助条件。
Two private-equity firms bought it for 2bn pounds.
It was floated at a value of 4.8bn pounds in 2015.
Mr Khwaja says that by buying Worldpay, Vantiv will reduce its reliance on bricks-and-mortarmerchants, which are losing out from a shift of retailing to online competitors such as Amazon.
Less than 10% of its revenue comes from processing e-commerce payments.
Worldpay, by contrast, makes more than one-third of its revenue from a fast-growing, globale-commerce business.
It is also the market leader in Britain, claiming a share of 42%, and has an American businessof its own (the country's eighth-biggest, one-sixth of the size of Vantiv's, says the NilsonReport).
The deal marks a further step towards the industry's consolidation.
Last year, for example, Global Payments, the sixth-biggest American acquirer, boughtHeartland, a smaller rival, for $4.3bn in cash and shares.
TSYS bought TransFirst for $2.4bn. Vantiv snaffled Moneris USA, the American arm of aCanadian payments-processor, for $425m.
In Europe, Mr Khwaja notes, national markets tend to be ruled by local players, despite theEU's supposedly single market.
Cross-border consolidation has far to go.
But in a business of thin margins, scale is starting to count.
Worldline, descended from the acquiring subsidiaries of three French banks, has spread intothe Benelux countries and Germany.
On July 3rd Nets, a Nordic payments company, said it had been approached about a takeover.
It's an acquisitive business.