June 12 - HomeATM PIN Payments Blog: According to reports trickling from the news wires, Global Payments Inc has agreed to buy the remaining (49%) stake in its British joint venture with HSBC Bank Plc for $307.7 million in cash..Global Payments, which processes online credit card transactions, said it expects the deal to add to its fiscal 2010 results.
It was just a year ago, (June last year) that Global Payments bought a 51 percent stake of HSBC's merchant services division. They paid $439 million for the majority stake in the joint venture to expand and provide payment processing services to merchants in Britain. So either they paid too much for 51%, ($8.6 million per percentage point) or got a helluva deal on the 49% ($6.3 million per percentage point) (or 2% of the HSBS Merchant Services was worth $131.3 million by itself)
Atlanta-based Global Payments said it used existing cash and lines of credit to complete the deal. Shares of Global Payments closed at $37.45 Thursday on the New York Stock Exchange.Here are some additional facts according to the London Bureau of the Wall Street Journal:
- The HMS joint venture was created in June 2008 when HSBC sold a 51% stake to Global Payments Inc., a processor of electronic transactions.
- HSBC and Global Payments also have sale-and-referral agreements in the U.S. and Canada along with a joint venture in Asia covering 11 countries and territories.
- A new 10 year marketing alliance agreement has also been signed, under which HSBC will continue to refer its U.K. customers to HMS.
- No staff will be affected by the change of ownership and HMS will continue to be based in Leicester.
Has many different options for merchant services at affordable prices.
Could this be the reason why HSBC has slapped its UK merchant customers with a £5 increase on their monthly minimum activity fee applicable from 1st September 2009?