WorldPay US has entered an agreement to purchase Century Payments, building on a four-year partnership between the two payments companies.
Century Payments has operated as an independent sales organization for WorldPay US, and "Century brings some competencies, such as its experienced sales force, technology and analytics capabilities, that will strengthen the company," says Patti Newcomer, WorldPay's chief marketing officer.
Atlanta-based WorldPay US, the American payment-processing unit of London-based WorldPay Group, did not disclose financial details of the acquisition.
The companies' strategy has focused on customer service for smaller merchants and a middle market that has been underserved, says Newcomer, who was speaking on behalf of Century Payments as well.
WorldPay specializes in payment acquiring, setting up merchants to accept card payments at the point of sale or online. Frisco, Texas-based Century Payments has operated a white-label electronic processing system that has served more than 50,000 merchants in the past four years while processing close to $12 billion in annual volume, the companies state in a Sept. 26 press release.
Because WorldPay and Century have worked so closely for several years, the deal "was not altogether surprising," says industry analyst Todd Ablowitz, president of Centennial, Colo.-based Double Diamond Group, LLC. "There is plenty of precedent for an ISO being acquired by its processor, and it's a pretty common way for a company to grow."
Both companies will benefit from being able to centrally integrate technology and expertise, he adds.
"The big picture here is that we'll continue to see attractive deals happening in the acquiring space," Ablowitz says. "Consolidation is an important part of this industry."
WorldPay expects to close the deal soon, Newcomer says. Century Payments will continue to operate out of Frisco while WorldPay completes various aspects of the purchase integration over the next six to nine months, she adds.
Where and how its sales force will operate "will all be under review" during that transition time period, Newcomer says.
The acquisition puts WorldPay in a better position to improve technology and infrastructure for its merchant clients, Newcomer adds.
"We had some gaps in our product suite in the past, but we have built it up based on feedback we have received from our clients, as well as being aware of technology developments in the industry," Newcomer says.
Indeed, WorldPay orchestrated some partnerships earlier in the year that indicated the company was embracing new technologies.
In April, WorldPay signed a contract with VeriFone to offer merchants the terminal maker's contactless and EMV-chip countertop terminals.
That announcement came three months after WorldPay's decision to work with Discover to bring PayPal transactions to the point of sale.
"We want mobile and tablet options to be more prevalent in our product suite and we are working with partners to do that over time," Newcomer says.
WorldPay is not committed or locked in to any specific point-of-sale or mobile technology, preferring instead to determine what is best based on their customers' needs, Newcomer adds.