Mastercard Invests $300 Million in Dubai Payments Firm
March 26 2019 - 9:28AM
Dow Jones News
By Nicolas Parasie
DUBAI -- Mastercard Inc. on Tuesday said it would invest $300
million in a Dubai digital-payments firm, the latest in a global
wave of deals in the industry.
Taking up to a 9.99% stake in Network International,
Mastercard's investment gives the Middle East company a boost as it
prepares for a London Stock Exchange debut, valuing it at around $3
billion.
The move is a vote of confidence on the future of digital
payments in the Middle East and Africa, where several cities are
among the world's most underpenetrated digital-payment markets.
Mastercard is betting emerging markets will continue its switch
to digital payments instead of using cash and checks. Consumers are
often skipping credit cards and banks altogether, increasingly
using mobile-phone apps to send and receive money. Mastercard and
Network International also plan to promote the use of electronic
payments in the Middle East and Africa.
A flurry of deals in the payment-firm sector has been prompted
by a shift in the global industry to mobile and online payment
forms. Fidelity National Information Services is paying roughly $35
billion for Worldpay Inc., while Fiserv Inc. bought First Data
Corp. a few months earlier in a $22 billion deal.
Firms like Network International help financial-service
providers, vendors and credit card companies including Visa and
Mastercard process digital payments.
Network International's chairman Ron Kalifa said investors in
the company would benefit "from a rapid structural shift from cash
to digital payments" in the region.
The partnership between the two companies involves jointly
developing projects and making cross-referral arrangements with
financial-services providers to boost credit card usage in the
region.
Network International started as a subsidiary of a predecessor
of Dubai's largest bank, Emirates NBD, and counts private-equity
firms General Atlantic and Warburg Pincus among its main
shareholders. Mastercard will buy Network shares at the same terms
as other institutional investors participating in the initial
public offering.
Write to Nicolas Parasie at nicolas.parasie@wsj.com
(END) Dow Jones Newswires
March 26, 2019 09:13 ET (13:13 GMT)
Copyright (c) 2019 Dow Jones & Company, Inc.
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