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Stone Payments, controlled by the Arpex Capital fund, and Banco PAN have acquired 100% of Elavon Brazil, which has a 2% share of the acquiring (point-of-sale) industry in Brazil.
Elavon was started as a joint venture between Citigroup and Elavon Inc, a subsidiary of US Bancorp. Citigroup had 49.9% of Elavon’s shares in Brazil and the USB Américas 50.1%.
Details of the financial transaction were not disclosed by the parties, but media reports suggested that the price tag was R$1, with some R$300 million in negative equity.
Citigroup had wanted an exit route from the joint venture last November and first began negotiations with Bradesco and Banco do Brazil (partners in Cielo, the recognised market leader). The potential deal failed for a number of reasons and Santander Brazil entered negotiations, as did Stone.
Management at Stone said that the deal was part of their strategy to grow within the Brazilian card market which had an annual turnover of around R$1 trillion. The company said that it would make a ‘relevant’ capital injection into Elavon.
Stone was created in 2013 and took R$1.4 billion from its POS machines in 2015 serving a customer base of some 7,600 active customers. In the same period, Elavon took R$16.4 billion.
The new combined business is expected to take over R$18 billion in transacted value over its machines.
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