Vantiv Says It Will Buy Moneris’s U.S. Operation With $425 Million in Cash on Hand

By Jim Daly
@DTPaymentNews

In a move that will further consolidate the U.S. acquiring business, payment processor Vantiv Inc. announced late Thursday that it has an agreement to buy Moneris Solutions Corp.’s U.S. merchant-acquiring subsidiary from its Canadian owners for $425 million in cash. 

Also known as Moneris USA, Schaumburg, Ill.-based Moneris Solutions Inc. processed $12 billion in payment volume last year. After the deal closes, Vantiv will service Moneris USA’s merchants and other business relationships, including its relationship with Chicago-based BMO Harris Bank, which has 600 branches.

Moneris Solutions Corp. is a joint venture of BMO Financial Group (parent company of the Bank of Montreal), and RBC Financial Group (parent of the Royal Bank of Canada). Harris is BMO’s U.S. affiliate. Moneris’s owners had been rumored this year to be shopping the U.S. operation, with Vantiv one of the possible suitors.

“Acquiring Moneris USA will further accelerate Vantiv’s growth in key high-growth channels,” Charles Drucker, Vantiv’s president and chief executive, said in a news release. “We look forward to serving their technology and bank partners with our deep payments expertise and strong customer service.”

The pending acquisition of Moneris USA is the latest in a string of deals over the past few years that have consolidated the U.S. merchant-acquiring industry. The most prominent recent deal was Global Payments Inc.’s acquisition earlier this year of Heartland Payment Systems Inc. for $4.3 billion.

Vantiv, based in suburban Cincinnati, says it is the nation’s second-largest payment processor, serving more than 800,000 merchant locations and 1,400 financial institutions. The company’s Merchant Services segment processed 19 billion transactions last year, up 17% from 16.3 billion in 2014.

“The acquisition will enable Moneris USA to continue its successful path and provide merchants the high level of service they’ve come to expect while leveraging Vantiv’s scale and omnichannel payments capabilities,” said Angela Brown, president and chief executive of Moneris. “Working together with Vantiv, Moneris will continue to support our mutual cross-border customers with a focus on innovation and service.”

The companies expect the deal to close by year’s end. Vantiv said it will fund the acquisition with cash on hand.

Vantiv’s previous acquisitions include Mercury Payment Systems, an independent sales organization and leader in so-called integrated payments, in 2014 for $1.65 billion, Element Payment Services Inc. in 2013 for $162.5 million, and e-commerce acquirer Litle & Co. in 2012 for $361 million.