According to a Sky News report, both companies are in advanced talks and the transaction could be announced as soon as this week.
This is exciting news for Mitchel Elegbe-led payments company that is also expecting to list of the London Stock Exchange through an Initial Public Offering (IPO) in the first quarter of next year. Though this IPO has been long expected and has been postponed for various reasons.
This is an important acquisition for Visa who would not want to be left behind in the incursion of global payment companies into Africa. Some months ago, rival company, Mastercard, invested $300m in Dubai-based Network International ahead of its stock market debut in London.
Unlike many other African fintech companies, Interswitch is already profitable and is keenly investing in the payments related space to increase its prominence in Africa.
It has been involved in some acquisitions in recent deals such as its acquisition of 60% stake in eClat healthcare services. In 2016, Interswitch acquired the mobile financial services player, VANSO. Interswitch had earlier closed the acquisition of Paynet Group in February 2015 in a deal that resulted in the creation of a combined network of over 100 financial institutions, deepening Interswitch’s footprint in East Africa.
The company is also thinking of becoming a Payment Service Bank (PSB) with the raising of 23 billion Naira for this effort.
In as much as this is a very good deal for Interswitch, one wonders what will happen to Interswitch’s home grown card brand, Verve. Interestingly, when Verve was born in 2009, not many people gave it a chance against big players like Visa and Mastercard. Even some companies didn’t believe in it. However, the card brand has grown larger than life in Africa.
It is estimated that Verve has over 20 million cards in circulation and its recent partnership with Discover Global Network, has made it possible for cardholders to use their cards in more than 190 countries and territories globally. It recently partnered with Ghana Interbank Payment and Settlement Systems Limited (GhIPSS) so that Verve Card users can now transact across all channels in Ghana.
Both companies have not officially confirmed this story but it is expected that they would do this in the coming days.
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