Chase Paymentech joint venture will split by year's end

Share this content:

JPMorgan Chase and First Data have agreed to an early exit of their joint venture, Chase Paymentech Solutions. Instead of the 2010 expiration date on the current agreement, the two companies have agreed to split up the payments and merchant acquiring business by the end of 2008.

When private-equity firm Kohlberg, Kravis, Roberts & Co. acquired First Data last September, it triggered a change-of-control provision that gave 51% owner JPMorgan Chase the right to negotiate an early end to the current agreement.

After the transition, JPMorgan Chase and First Data will operate separate payment businesses. In 2007, Chase Paymentech processed approximately 19.7 billion payment transactions, with more than $719 billion in annual bank card and debit volume. Chase Paymentech's customer base includes 70 percent of leading e-commerce businesses and more than 600,000 merchants worldwide.

JPMorgan Chase will retain 51% of the joint venture's assets, including most of its employees, the Canadian and European operations, the Dallas headquarters and the Chase Paymentech name.

First Data will continue to provide transaction processing and data commerce solutions for merchants through its current technology platforms and will assume management of the full-service ISO and Agent Bank unit of the joint venture. It will integrate its 49% of the joint venture's assets and a portion of the employees into its business.

On April 28, First Data said it has reached an agreement to acquire InComm Holdings Inc. for $980 million, plus contingent future payments of up to $250 million. InComm is a distributor of gift cards, prepaid wireless products, reloadable debit cards, digital music downloads, content, games, software and bill payment solutions.

Loading links....
close

Next Article in Marketing Strategy

Sign up to our newsletters

Company of the Week

Since 1985, Melissa Data has helped thousands of companies clean, correct and complete contact data to better target and communicate with their customers. We offer a full spectrum of data quality solutions, including global address, phone, email, and name validation, identify verification - available for batch or real-time processes, in the Cloud or on-premise. Our service bureau provides dedupe, email/phone append and geographic/demographic append services for better targeting and insight. For direct mailers, Melissa Data offers easy-to-use address management/postal software, list hygiene services and 100s of specialty mailing lists - all with competitive pricing and excellent customer service.

Find out more here »

DMN's Career Center

Check out hundreds of exciting professional opportunities available on DMN's Career Center.  
Explore careers in digital marketing, sales, eCommerce, marketing communications, IT, data strategies, and much more. And don't forget to update your resume so employers can contact you privately about job opportunities.

>>Click Here