U.S. credit card processing company Vantiv moves closer to creating a $29 billion global payments powerhouse with a formal offer to buy Britain's Worldpay for 8 billion pounds ($10 billion). Sonia Legg reports.
It knows a thing or two about making payments for customers but Worldpay is making headlines for its own transaction. U.S. credit card processing company Vantiv has made a formal offer to buy the British firm for £8 billion - that's 397 pence per share. The deal will create a $29 billion global payments powerhouse. (SOUNDBITE) (English) NEIL WILSON, SENIOR MARKET ANALYST, ETX CAPITAL, SAYING: "It is a very very big deal for the FTSE, some people have suggested it might be too big. But I think it's indicative of the payments industry which is consolidating very rapidly." The combined company will be called "Worldpay" and will be headquartered in Cincinnati. It will have a primary listing in New York and a secondary one in London, from where its international operations will be run. But the deal has taken five weeks to put together because of haggling over governance. And even then there was no agreement on safeguarding UK jobs. (SOUNDBITE) (English) NEIL WILSON, SENIOR MARKET ANALYST, ETX CAPITAL, SAYING: "There is bound to be job losses. I think it's inevitable. I think they can merge their back office stuff and it will be very unlikely that all jobs will be protected." Worldpay shareholders will own around 43 percent of the new business, while Vantiv investors have the rest. The group will be led by Vantiv boss Charles Drucker as executive chairman. He'll also co-CEO with Worldpay boss Philip Jansen. They'll run a company with net revenue of $3.2 billion dollars. And it will live up to its name, processing $1.5 trillion of payments and 40 billion transactions in 146 countries.