Denver-based First Data has taken a 60-65 per cent equity interest in bank-backed payments outfit NYCE. Terms of the transaction have not been disclosed.
NYCE, which services 48 million cardholders through 44,000 ATMs and 270,000 point-of-sale locations, will continue as a separate entity.
Four of the current NYCE shareholders - Citibank, FleetBoston Financial, HSBC, and JPMorganChase - will continue as equity partners, along with First Data.
The companies say they will collaborate to develop products that will attract new card issuers and expand ATM deployment beyond current NYCE service areas of petrol stations, convenience stores and supermarkets.
"The PIN-based debit expertise of NYCE and First Data's offline debit, credit card leadership, and prominence at the point of sale, will open up new areas and channels of trade," says Dennis Lynch, president and chief executive officer of NYCE.
The transaction is expected to close during the second half of 2001, subject to regulatory approvals and other closing conditions.