1 + 1 = 3. That would be what two giant companies hope for when they merge. As the following Digital Transactions article reports, Worldpay (or Vantiv) has some thoughts to pass along for Fiserv and First Data as they begin their marathon process of a proposed merger.
The global processor Worldpay Inc. is beating its own expectations in knitting together the assets combined in the huge merger of Vantiv Inc. and Worldpay plc and is looking to make more acquisitions this year, top executives said Tuesday.
Speaking to stock analysts to discuss Cincinnati-based Worldpay’s fourth-quarter and full-year 2018 results, chief executive Charles Drucker also had some words of advice for Fiserv Inc. as it looks to swallow First Data Corp. in what will be an even larger industry merger than the big Worldpay deal, which closed 13 months ago. “We do have a close eye on that,” Drucker said.
Drucker warned, however, that big mergers can bring big headaches if not managed carefully. The first matter Fiserv and First Data will have to pay close attention to will be personnel, he said. “It’s two powerful companies coming together,” he noted. “In the short term, they have to sort through the complexities of the companies.”
Clarity with managers and staff will be crucial, he added. In the Worldpay-Vantiv merger, “we were very clear about who’s running what, and we did that very quickly,” Drucker said. “It’s how you manage your people that will determine” how disruptive the deal will be early on, he predicted.
They’ve seen this movie before—so it’s no surprise that Worldpay has some thoughts about the pending Fiserv-First Data merger. The tips for these types of mega-marriages typically relate to the challenges of assimilating two large organizations with hundreds of departments. Sorting out management roles and aligning cultural differences are no easy tasks. Never mind keeping your eye on the ball to run the business and to keep clients happy. We will be following this closely as it unfolds. Mercator gave its initial thoughts on the surprising announcement in a previous analyst commentary Fiserv-First Data Alliance To Bring Opportunities and Challenges. This was the first significant payment industry deal of 2019—it won’t be the last.
Overview by Raymond Pucci, Director, Merchant Services at Mercator Advisory Group