Visa and Plaid have terminated their merger agreement after the US Justice Department (DoJ) filed suit to block the combination over competition concenrns. The DoJ filed its antitrust complaint in federal court in November in an effort to scupper the blockbuster $5.3 billion takeover, insisting it „must be stopped”.
Visa Inc. and Plaid today announced that the companies have terminated their merger agreement and agreed with the Department of Justice to dismiss the litigation related to the proposed transaction. The proposed transaction was first announced on January 13, 2020.
The Justice Department determined that the acquisition of Plaid by Visa would eliminate a nascent competitive threat to the card scheme’s own business.
“We are confident we would have prevailed in court as Plaid’s capabilities are complementary to Visa’s, not competitive,” said Al Kelly, Chairman and CEO of Visa Inc. “We believe the combination of Visa with Plaid would have delivered significant benefits, including greater innovation for developers, financial institutions and consumers. However, it has been a full year since we first announced our intent to acquire Plaid, and protracted and complex litigation will likely take substantial time to fully resolve.”
Mr. Kelly added, “We are focused on accelerating our business by advancing our broader strategy and continuing to drive Visa’s three growth pillars: consumer payments, new flows, and value added services. We have great momentum to build upon. Over the past year, our Visa Direct solution moved money around the world using multiple card, ACH and RTP networks, growing nearly 70 percent. In addition, our value added services revenue has grown in the mid-to-high-teens. We have great respect for Plaid and the business they have built and look forward to our continued partnership.”
“This past year saw an unprecedented uptick in demand for the services powered by Plaid, and our priority is to support the hundreds of millions of people who now rely on fintech,” said Zach Perret, CEO and co-founder of Plaid. “We made great strides last year, growing our customers by more than sixty percent and adding hundreds of banks to our platform. While Plaid and Visa would have been a great combination, we have decided to instead work with Visa as an investor and partner so we can fully focus on building the infrastructure to support fintech.“
2020 has been one of exciting growth for Plaid. „Hundreds of new banks joined our platform, and over 4,000 companies turned to Plaid as the infrastructure to support their businesses, including many of the largest Fortune 500 companies who are focused on bringing digital financial products to their customers. Supporting the increased demand for digital finance that COVID has brought is our top priority,” said the CEO of Plaid
„I expect 2021 to be more of the same. In addition to our ongoing focus on helping companies of all sizes deliver digital financial products, we have made significant progress in the ways that we work with financial institutions. Delivering on the promise of open finance is in everyone’s best interest, and we’ll be working in lockstep with our customers and financial institutions to bring this to fruition globally,” Perret added.
Banking 4.0 – „how was the experience for you”
„So many people are coming here to Bucharest, people that I see and interact on linkedin and now I get the change to meet them in person. It was like being to the Football World Cup but this was the World Cup on linkedin in payments and open banking.”
Many more interesting quotes in the video below:
