Tsys agrees $1.4bn NetSpend acquisition
20 February 2013 | 4473 views | 0
Payments processor Tsys has agreed to buy NetSpend, a provider of pre-paid debit cards to America's underbanked, for around $1.4 billion in cash.
Under the terms of a definitive agreement, NetSpend shareholders will receive $16 a share, a 30% premium on Tuesday's closing price, according to Reuters.
NetSpend targets the millions of Americans without traditional bank accounts, offering them pre-paid debit cards and related financial services. The firm serves more than 2.4 million accounts - 46% of which are direct deposit accounts - with more than 500 retail distributors and 130,000 reload locations.
Philip Tomlinson, CEO, Tsys, says: "The NetSpend acquisition is truly a transformational event for Tsys and consumers alike. It enables us to meet our strategic goals of diversifying our business, being a more innovative payment solutions provider and expanding our role within an area of payments that is expected to grow at a 20% annual rate over the next four years."
The transaction is expected to close in mid-2013, subject to regulatory approvals, approval by NetSpend shareholders and customary closing conditions.