UK Competition Watchdog Clears VISA Acquisition of Ripple Partner Earthport

Today VISA announced that it has acquired control of Earthport, the company that has a payments network with banking relationships in 87 countries and is a Ripple partner. The UK listed company was the subject of a bidding war between VISA and Mastercard. The latter eventually withdrew and acquired another company Transfast.

The final price paid for Earthport of £247 million ($321.1 million) was almost five times the pre-bid price, an unusually high premium for an acquisition.
Apart from Ripple, the company has numerous high profile clients including Bank of America Merrill Lynch, TransferWise, BNP Paribas and Xoom. Earthport powered Santander’s first Ripple app. But the main appeal to VISA was the 87 foreign banking relationships.

VISA plans to use its network to create an alternative to SWIFT payments. The market size for money sent by wire transfer or bank accounts globally is $80 trillion. The company said: “Currently, Visa enables payments to be sent to or from Visa cards. The acquisition will make it possible for Visa clients to enable individuals, businesses and governments to utilize Visa to send and/or receive money through bank accounts around the world.”
The company highlighted use cases such as payroll, international person-to-person transfers as well as business-to-business payments. To that end, VISA is working on its B2B Connect blockchain network for high-value business payments.

“Visa is modernizing the way we move money by making it quicker, safer and easier to pay and be paid than ever before,” said Bill Sheley, head of global push payments, Visa. “The acquisition of Earthport unleashes the power of Visa by taking us ‘beyond the card,’ empowering us to enable our clients to make payments through bank accounts around the world.”
Having won the battle with Mastercard for Earthport, at the start of April, the UK’s Competition and Market Authority (CMA) announced it was launching an inquiry into the merger. Today the CMA said the merger does not qualify for investigation.

Earthport’s technology will allow Visa to further expand and scale Visa Direct’s rapidly growing portfolio of use cases, including funds disbursements, peer-to-peer payments, cross border payments, marketplace payouts, and bill payments. Over the last 12 months, Visa Direct’s transaction count growth has continued to be over 100% - showing the demand for faster, smarter money movement among consumers and businesses around the world.

About Visa Inc.
Visa Inc. (NYSE: V) is the world’s leader in digital payments. Our mission is to connect the world through the most innovative, reliable and secure payment network - enabling individuals, businesses and economies to thrive. Our advanced global processing network, VisaNet, provides secure and reliable payments around the world, and is capable of handling more than 65,000 transaction messages a second. The company’s relentless focus on innovation is a catalyst for the rapid growth of connected commerce on any device, and a driving force behind the dream of a cashless future for everyone, everywhere. As the world moves from analog to digital, Visa is applying our brand, products, people, network and scale to reshape the future of commerce. For more information, visit About Visa, visa.com/blog and @VisaNews.

About Earthport
Earthport (AIM: EPO) provides cross-border payment services to banks, money transfer service providers and businesses via the world’s largest independent ACH network. Customers gain new levels of predictability, transparency and cost-efficiency without intermediary deductions or landing fees. This is underpinned by bank-grade compliance expertise, providing peace of mind to clients, and end-to-end FX, treasury and cash management solutions to support customers with their growth.

May 09, 2019