Bidco, a wholly-owned direct subsidiary of Visa, reached an agreement to buy the British payment company Earthport for £198 million ($250.6 million).
A subsidiary of the US-based payment Technology group has offered 30 pence in cash for Earthport’s Shareholder which represents a premium of approximately 250% to the six-month volume weighted average price of 8.6 pence per Earthport Share to 24 December 2018 (the last Business Day before the date of the deal); and 50% to the Placing share price of 20 pence per Earthport Share on 4 October 2017.
Earthport, a global payment network, powers transactions for the world’s largest financial institutions, e-commerce companies, money transfer organizations, and payment aggregators.
The Offer is subject to the further conditions and terms, including receipt of customary competition and merger clearances and on receiving the approval of the Financial Conduct Authority in the UK.
"The Earthport Board believes the offer by Bidco represents an opportunity for shareholders to realise an immediate and attractive cash value in Earthport today. Visa shares our vision of growth and expansion for Earthport and, as such, we believe it is a suitable and appropriate partner for our employees, partners, customers, and other stakeholders," said Sunil Sabharwal, Chairman of Earthport, in a statement.
Meanwhile, Amanda Mesler, CEO of Earthport, said "Having been appointed as Earthport's CEO in July my focus, following a full strategic review has been to rapidly implement a transformational growth strategy. Whilst I believe Earthport is well positioned to deliver the potential it has always possessed, the all-cash offer from Visa represents a very attractive and immediate return for our shareholders.
Earthport’s share price surged 289% to the offered price today, then getting below 28.28 pence at the mid of trading day.
The British company’s Revenues grew 5.3% to £32 million ($40.5 million) in 2018 financial year, with 35% increase of Local network connectivity in 86 countries at the period end.