Visa Buys CyberSource For $2 Billion

Visa looks to boost its ecommerce business

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Visa said today it has agreed to buy online payment processing firm CyberSource in an effort to strengthen its ecommerce business.

Visa said it will pay $26 a share or about $2 billion for CyberSource. The deal is expected to close in Visa’s fiscal fourth quarter. The transaction will dilute Visa’s earning for that quarter by about 4 or 5 cents a share.

CyberSource processes about 25 percent of all ecommerce transactions in the United States. The company serves more than 295,000 merchants through its CyberSource and Authorize.Net brands. Its clients include British Airways, Home Depot, Facebook, Google and many small businesses.

Joseph-Saunders-Visa “Online commerce continues to grow rapidly, and this acquisition will enable Visa to offer new and enhanced services that will better meet the growing demand among merchants globally for robust, secure online payment processing capabilities which in turn will grow the entire eCommerce category," said Joseph W. Saunders, Chairman and CEO of   Visa Inc. 

"With CyberSource, we are adding a new suite of leading eCommerce capabilities and experience in addressing eCommerce merchant needs. And, as eCommerce increasingly migrates to mobile devices, we believe the combination of Visa and CyberSource technology and services will position Visa to lead in mobile eCommerce."

Visa and CyberSource have been partners since 1999. Visa says the deal will help merchants increase revenue through global growth and by connecting them to multiple payment networks.

Visa Buys CyberSource For $2 Billion
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    Basically Visa wants to cut out the middle man so that they can hold on to the money and make the fraction of a point of interest of hundreds of millions of dollars a day sitting in Cybersource’s bank account before it reaches them and also not have to pay Cybersource their cut of the transaction on top of it for processing.

    If you add all the money that goes through them, $2 billion dollars for the company is cheap if you ask me. I bet they make up the $2 billion in less than 2 years.

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