Visa Inc. an American Financial Services Corporation has reached an agreement to acquire Ripple’s partner, a UK-based financial service company, Earthport. The agreement states that Visa will pay 198 million pounds which equals $251 million for the financial service company. Visa made a proposal to Earthport, offering to pay 30 pence for each of Earthport share, which is more than 7.45 pence per unit as traded on the stock on Monday.
Earthport is a FinTech50 cross-border payment processing institution regulated by the UK Financial Conduct Authority. It offers its clients access to global payment services and also maintains a partnership with local banks and customers businesses are settled through these local banks. It is as well an Authorised Payment Institution (API) just like banks.
A close observation shows that Earthport shares have not done well recently on the London Stock Exchange secondary market where it was listed. Due to increasing overhead costs, the value of the share had decreased by 28%, so the firm had taken this measure to boost their business.
Earthport services include eliminating all the bottlenecks experienced by clients in cross-border payment, to provide a cheaper, faster and seamless experience. It provides direct clearing services through local banks.
Earthport had been in partnership with Ripple for some years now, it is most likely that Visa may consider partnering with Ripple to further strengthen this acquisition. But this is a decision that is left to be taken by the two giants, Some Ripple enthusiasts believe it may not work out since the duo is in the same line of business.
Some time ago, it was rumored that Ripple would partner with SWIFT, which, unfortunately, didn’t come to pass. Now Ripple is as close as possible to tie the nuts with Visa by acquiring its partner, if that happens, it will really be a mega partnership which will facilitate Ripple to achieve its vision of “taking over.”