Global Payments completed a series of strategic moves today to bolster their business-to-business focused strategy. Fintech Rêv along with private equity firm Seachlight announced the acquisition of Netspend’s consumer prepaid business bringing to a close the parent company’s search for a buyer of the consumer focused assets. The move for Rêv adds additional consumer focused depth to their operations:
“The acquisition brings back Netspend’s founders, Roy and Bertrand Sosa, who also founded Rêv. The Sosa brothers look to leverage the strategic assets of the two entities to build a global, high growth company that delivers on a mission of financial empowerment and product innovation.
Christopher Cruz, Partner, Searchlight, added ‘The characteristics of this investment are rare to find. Combining an industry leading operation in Netspend’s consumer business with modern platform technology and digitally native solutions from Rêv unlocks great growth potential by meeting the needs of a significant and sizable market. We look forward to partnering with Roy, Bertrand, and the Rêv team as they continue their mission to financially empower underserved consumers through fintech innovation.’”
Global payments had announced their intentions to divest Netspend in February, as covered in Payments Journal because of the inherent strategic desire to offload the consumer facing assets, which did not overlap and complement Global Payment’s traditional client base. With this move Global Payments receives an infusion of $1 Billion in cash and can move forward with its B2B core, including their simultaneous announcement of the purchase of EVO, a finetch focused on aiding B2B payments, with a core customer base in Europe. Reuters has additional details on the EVO acquisition:
“The deal would give Georgia-based Global Payments access to new markets including Poland, Germany, Chile and Greece and also help scale-up its business in existing markets such as the United States and Canada, the company said.
EVO has a sizable presence in Europe which accounted for nearly 40% of its revenue in the first three months this year.”
These moves highlight the importance of strategic fit in the payments space. Evo brings Global Payments a desired international presence and increased B2B footprint while Netspend adds a positive strategic prepaid market to Rêv’s portfolio.
Overview by Jordan Hirschfield, Director, Prepaid Advisory Service at Mercator Advisory Group