08 July 2015

MasterCard pays £290m for Travelex pre-paid card unit

09 December 2010  |  10331 views  |  0 handshake

MasterCard has acquired the pre-paid Card Program Management operations of Travelex for £290 million in cash.

The unit manages and delivers consumer and corporate pre-paid travel cards to financial institutions, retailers, travel agents and foreign exchange bureaus around the world. It also manages cross-border payroll, per-diem and expense-management pre-paid cards.

The two firms - which already work together - have also signed a long-term contract whereby MasterCard will provide program management services for the Travelex Cash Passport pre-paid card.

MasterCard - which has no plans to issue cards directly - says the acquisition strengthens its position in pre-paid, a fast-growing sector. The company cites a recent Boston Consulting Group study indicating that pre-paid is expected to reach more than $840 billion in global volume by 2017, a CAGR of 22%.

Ajay Banga, CEO, MasterCard, says: "This acquisition enables MasterCard to play a greater role in the prepaid value chain, allowing us to shape the future of prepaid, especially in high-growth markets and in the attractive cross-border payments space where we can displace cash and traveler's cheques."

Peter Jackson, CEO, Travelex, adds: "The sale of CPM will allow us to accelerate our investment plans, particularly in higher growth regions such as Asia and South America and in the growing e-commerce channel."

The deal also includes an earn-out of up to an additional £35 million if certain performance targets are met. The transaction, expected to close in the first half of 2011,is expected to be $0.04 dilutive to MasterCard's 2011 earnings, neutral in 2012 and accretive in 2013.

Comments: (0)

Comment on this story (membership required)
Log in to receive notifications when someone posts a comment

Finextra news in your inbox

For Finextra's free daily newsletter, breaking news flashes and weekly jobs board, sign up now.

Related blogs

Create a blog about this story (membership required)

Related stories

08 December, 2010
08 December, 2010
07 December, 2010
02 December, 2010
19 August, 2010
27 November, 2009
29 February, 2008

Related company news


Top topics

Most viewed Most shared
US banks pump $16.6bn into digital transfo...
8318 views comments | 39 tweets | 27 linkedin
Fintech leads the charge as VC investment...
6671 views comments | 33 tweets | 17 linkedin
Mobile banking biometrics gains traction
6371 views comments | 27 tweets | 25 linkedin
Nordea sets up fintech accelerator
5489 views comments | 21 tweets | 12 linkedin
Santander and Monitise form fintech ventur...
5207 views comments | 14 tweets | 13 linkedin

Featured job

to £65K base, double OTE
London, UK

Find your next job