The rush to be a "one stop shop" for merchants by bundling mobile, Web and in-store payment technology is prompting many companies to join forces, resulting in several high-priced mergers and acquisitions in recent years.
TSYS and TransFirst
Among the most recent deals is TSYS' agreement to buy TransFirst for $2.4 billion. "Thirty percent of [TransFirst's] revenue is in the integrated payments space, and their e-commerce operation is bigger and more robust than ours," said M. Troy Woods, president and CEO of TSYS, just after the deal was announced on Jan. 26.
Global Payments and Heartland Payment Systems
Global Payments' $4.3 billion dollar agreement to buy Heartland makes a big deal about working with small merchants. "This will create the leading provider of integrated payments technology solutions worldwide, and positions our company as a leading provider of payments for small to medium sized businesses in the U.S.," said Jeff Sloan, CEO of Global Payments, in December.
Vantiv and Mercury Payment Systems
Vantiv's $1.65 billion purchase of Mercury Payment Systems in 2014 was a major bet on Mercury's integrated payments model. "The key to this is taking Mercury's model and continuing to allow it to grow," said Charles Drucker, president and CEO of Vantiv.
Visa and Visa Europe
Among the many reasons Visa is buying back Visa Europe for $23.4 billion is the chance to pool tech resources on a global scale. "The transaction will provide European clients with direct access to our investments in technology, differentiated products and services, capital and talent," said Charlie Scharf, Visa's CEO, in November.
PayPal and Paydiant
PayPal's 2015 purchase of Paydiant, for $280 million, gave PayPal a chance to work in the stores of the major merchants behind the MCX mobile wallet venture. "The fact that we have traction with large retailers with MCX and outside of MCX, I am sure that was part of what was attractive about us to PayPal," said Chris Gardner, CEO of Paydiant, when the deal was announced.
PayPal and Venmo (Braintree)
When PayPal bought Braintree for $800 million in 2013, the Venmo app was a welcome inclusion in that deal. Venmo's success in mobile P-to-P is becoming the foundation of PayPal's in-app purchase strategy. "Many merchants want the Venmo button, because its the way millennials think about managing and moving their money," said Dan Schulman, PayPal's president and CEO, in January.
Verifone and AJB Software
Verifone is buying AJB Software for an undisclosed price, with a goal of providing more services to the merchants that use its point of sale hardware. "Merging AJB's solutions and expertise with Verifone's breadth of services and systems expertise will provide retailers multiple options to manage and secure their payment infrastructure," said Jennifer Miles, president of North America for Verifone, in a Jan. 15 press release.
First Data and Spree
First Data's putting more muscle behind e-commerce, as evidenced by its September purchase of Spree Commerce. "With its deep subject matter expertise and successful open source software development, Spree will help First Data build stronger connections to the developer community and bolster our ability to deliver unrivaled e-commerce solutions to businesses around the world," said Dan Charron, head of global business solutions at First Data.