This story has been revised from its original version.
Visa Inc. on Feb. 7 announced the new conversion rate applicable to the company’s class B common stock resulting from its Dec. 29 deposit of $1.6 billion into the litigation escrow account, which it would use to pay an anticipated settlement of civil antitrust charges brought by merchants.
Under the terms of the Visa's retrospective responsibility plan, this resulted in the decrease in the conversion rate applicable to the company’s class B common stock from 0.4881 to 0.4254, effective as of December 29. Therefore, the number of as-converted class B common shares was reduced by about 15.3 million, to 104.5 million from 119.8 million.
The deposit and price-per-share calculations were conducted in accordance with the company’s certificate of incorporation using the volume-weighted average price over the 30-day pricing period from Dec. 22, 2011, through Feb. 6, 2012.
Last week, MasterCard Worldwide said it plans to use $770 million of its shares owned by credit unions and banks to add to its own litigation account to pay its share of the settlement, which has yet to be finalized (see story).
Merchants who claim Visa and MasterCard conspired to suppress competition by banning merchants from steering customers to cheaper forms of payment brought the civil claims. The two companies last year agreed to settle similar antitrust charges brought by the U.S. Department of Justice (see story). A settlement of the merchants’ case may be as much as $4 billion.
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