VeriFone/Hypercom Merger Blocked by Assets Sale Plans to Ingenico
- The US Department of Justice (DoJ) started a civil lawsuit to prevent VeriFone’s purchase of Hypercom due to the decision to transfer some of Hypercom’s US assets to France-based Ingenico. The DoJ deems that this transfer does not resolve its antitrust concerns: it would strengthen an already settled player and would not benefit a new, independent, long-term competitor.
- Ingenico considers the US market would benefit from the planned sale: its Telium range of products would provide attractive, varied, innovative and up-market solutions. It is now most likely that it will not benefit from this operation. In fact, Verifone and Hypercom, covering 60% of the US POS terminal market, have told the DoJ they were now considering an alternative purchaser. The CEO of the smaller, contactless-oriented, US terminal manufacturer ViVOtech said he was interested.
- Ingenico and VeriFone show similar annual sale figures (about one billion euros, slightly less for the second) in 2010. Hypercom did not even reach half of this amount.
- Ingenico’s growth may be hindered in the United States but it remains steady in China. Its local e-payment subsidiary, Fujian Landi, won several banking contracts since begin 2011: Bank of China (BoC) and the smaller bank CMSB (China Minsheng Bank). Landi owns almost 35% of the POS terminal market share: it is China’s first provider. It also offers acceptance systems, CATs and payment software to ICBC, CCB, CMBC, BoCom and CITIC. It is also currently working on mobile payment solutions with China Telecom and China Mobile.
See November 2010 Watch