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Payments processor Vantiv buys WorldPay for $10 billion

A future without cash?

The payments processing industry is witnessing some big purchases of its own. 

Payments processor Vantiv (VNTV) has agreed to buy British rival WorldPay in an 8 billion pound ($10.4 billion) deal that will create a giant in the sector.

Vantiv, based in Cincinnati, Ohio, will pay 3.97 pounds a share in cash, stock and dividends for Worldpay, 24 percent more than the closing price on July 3, when news of the talks became public. The combined company will process about $1.5 trillion of payments annually through over 300 payment methods in 146 countries.

The acquisition comes as the payments processing industry is consolidating, partly in response to consumers' increasing reliance on online shopping, which is boosting their use of electronic payments. Paysafe Group last week was agreed to be bought by Blackstone Group and CVC Capital Partners for $3.9 billion, while several buyout firms are considering bids for Danish payment-services company Nets A/S.

"The growth of e-commerce and the way consumers expect to transact is increasing complexity for businesses around the world," said Philip Jansen, chief executive officer of Worldpay, in a statement. "Our unique combination of scale, innovation, technology, and global presence will mean that we can offer more payment solutions to businesses, whether large or small, global or local, enabling them to meet consumers' increasing demands and helping them prosper."

The takeover will combine Vantiv's U.S.-focused business with WorldPay's operations around the world. 

The company will be called Worldpay and will be led by Vantiv Chief Executive Charles Drucker, who will become executive chairman and co-CEO of the new company. WorldPay boss Philip Jansen will be the other co-CEO.

Vantiv was created in 1971 by Fifth Third Bank, and later that decade created the first U.S.-based shared online ATM network. The company was spun off from Fifth Third Bank in 2009, and went public in 2012.