Visa to buy Earthport for £198 million

Visa Inc is to pay £198 million pounds to buy Earthport Plc, a British firm that facilitates international transactions for banks and businesses.

    Visa to buy Earthport for £198 million

Visa International Service Association, a unit of Visa, has offered 30 pence for each Earthport share, a price that is four times the stock’s Monday closing price of 7.45 pence.

Earthport shares surged in early trading on Thursday and matched the offer price.

The London-headquartered firm said Visa’s proposal was “fair and reasonable” and that it would recommend its shareholders take up the all-cash offer.

Earthport’s shares, listed on the London Stock Exchange’s secondary market, have fallen more than 28% this year amid growing losses and expenses, forcing the firm to say last month that “fundamental” change was required in its strategy.

Earthport says it offers a lower-cost alternative to traditional payments systems by allowing banks and money transfer firms to have a single relationship instead of multiple ties with various payments channels around the world.

For Visa, cross-border payments, or transactions that involve parties in two or more countries, represents a growing business. The volume of such payments rose 10% in the 2018 fiscal year, Visa said in October.

Earthport, which counts Bank of America Merrill Lynch and Japan Post Bank among its clients, said Visa’s offer was a revised proposal that followed an indicative offer.

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