MasterCard has stepped up its assault on the e-commerce market with a deal to buy European payment service provider DataCash for around £333 million in aggregate.
The card giant will pay 360 pence a share for the AIM-listed DataCash, a premium of 53% on yesterday's closing price of 234 pence. The company's shares have subsequently soared, trading at around 355 pence in morning trading.
Headquartered in London, DataCash also has operations in Dublin, Mannheim and Cape Town, employing 362 people. It provides a single interface for e-commerce merchants to process payments across the world and also offers fraud prevention and back-office reconciliation.
Last year the firm processed over 240 million transactions for more than 1400 merchants in a variety of sectors, including retail, travel and leisure, entertainment, gaming and telecommunications.
MasterCard says the acquisitions will help it grab a larger slice of the e-commerce market, particularly in Europe. It also hopes the deal will enhance the MiGS gateway business currently operating in Asia Pacific, enabling merchants to gain new market reach and access to value-added services.
Earlier this year MasterCard launched an online shopping mall as part of its assault on an e-commerce market. It's rival Visa is also investing heavily in the online arena, recently completing the $2 billion acquisition of CyberSource.
Ajay Banga, CEO, MasterCard, says: "E-commerce represents an important part of MasterCard's growth strategy, and this acquisition will allow us to provide new services to our acquiring customers, as well as drive increased e-commerce penetration in both existing and new markets."
The deal is expected to be closed by the end of October, subject to conditions. MasterCard expects it to be approximately $0.05 dilutive to fourth quarter earnings per share due to amortization and one-time transaction costs.