Fifth Third Bancorp in Cincinnati plans to record a one-time, pretax gain of about $1 billion during the third quarter as it continues to sell off its equity stake in the payment processor Vantiv.

Fifth Third said Tuesday that it has agreed to sell 19.8 million shares to Vantiv, valued at about $64 per share. The transaction is contingent on the payment processor publishing a formal offer to acquire Worldpay. That offer is expected to be announced Wednesday, unnamed sources told Reuters.

Going, going ...
If Vantiv purchases Worldpay, Fifth Third’s stake in Vantiv will likely be reduced to about 4.9%. Bloomberg News

Vantiv, which was spun off from Fifth Third in 2009, announced last month that it would acquire Worldpay, the U.K. merchant acquirer in a $10 billion deal.

Once the stock transaction is complete, Fifth Third will own approximately 8.6% of Vantiv, which is also based in Cincinnati. Then, after the Worldpay transaction closes, Fifth Third’s stake will likely be reduced to about 4.9%.

Fifth Third will lose a designated seat on the Vantiv board once the transaction announced Tuesday is complete. Lars Anderson, the bank's chief operating officer, currently serves on the Vantiv board.

Executives with the $141 billion-asset Fifth Third have indicated in recent months that they plan to continue scaling back the company’s stake.

Vantiv shares have increased about 10% since the November election.

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Kristin Broughton

Kristin Broughton

Kristin Broughton is a reporter for American Banker, where she writes about the business of national and regional banking.