Visa, it is reported, is in the process of acquiring stakes in Interswitch, an African payments group for an undisclosed amount. The market grapevine is that the stock acquisition will be for US$ 200 million and a few others are of the opinion that it would be more than that. The biggest beneficiary in the deal will be Interswitch, which will be catapulted as a unicorn. Visa, with the stock acquisition will have control of over 20% of the shares of Interswitch.
Interswitch is a Nigerian-headquartered, African focused digital payments and commerce company that facilitates the electronic circulation of money as well as exchange of value between individuals and organizations. It also provides training and advisory services in the e-payments and e-business industry. It proposes to go for an IPO in early 2020 ahead of a prospective initial public offering in London during in the first half of next year.
The digital platforms at the ownership of the company include electronic payments and infrastructure companies, with point-of-sale terminals, online consumer payment platforms and its own card, named as Verve. The digital platforms are used in 19 countries in Africa and the popularity of the network in growing.
Recently, Visa’s global rival, Mastercard, invested US$300m in Dubai-based Network International before it made its debut in London. Network International is the largest payment processor in Africa and the Middle East. Its shares are trading well in London. This could be the reason that motivated Visa to go for a tie up with Interswitch and to list in London Stock Exchange.
Interswitch is both profitable and generating significant levels of cash. Countries where it has operations include Nigeria, which is home to nearly 200 million people.
