MasterCard is reported to have entered exclusive talks to buy Vocalink as it bids to capture a greater share of UK debit card payments from Visa.
Sky News initially reported that the 13 banks which are shareholders in Vocalink have approved a period of exclusivity within which MasterCard can negotiate a takeover of the company.
Any deal is likely to be worth in the region of £1bn, according to insiders, handing a useful windfall to the four biggest UK banks – Barclays, HSBC, Lloyds Banking Group and Royal Bank of Scotland – which between them own about 80% of Vocalink.
If a deal is completed, it will see control of a key part of the UK’s financial infrastructure relinquished by big high street lenders just months after the new payments industry regulator said Vocalink’s existing ownership structure was “hampering competition and the speed of innovation in the market”.
Vocalink processed 11 billion transactions last year, equating to more than half of all payments made in the UK.
Sources said that MasterCard had been drawn to Vocalink’s recent technological advances and successful international expansion.
News of the exclusive talks comes just hours after Visa Inc. was forced by regulators in Brussels to amend the terms of a takeover of Visa Europe to ease anti-trust concerns.