MasterCard To Go Public
PURCHASE, N.Y. - (09/01/05) -- MasterCard Inc., the number two cardcompany, beleagured over the last two years by legal setbacks, saidWednesday it plans to raise more than $1 billion in new capitalwith an initial public offering. The card association, which isowned by 1,400 banks and credit unions, plans to sell 59% of thecompany to the public in a new stock issuance. The public offeringwill be part of a corporate restructuring that will entailappointment o a new board of directors, a majority of which will beindependent members, and the creation of a charitable foundation.The move comes as MasterCard and Visa USA are paying off a combined$3 billion antitrust settlement and face new lawsuits filed byAmerican Express Corp. and Discover Financial Services seekingdamages stemming from anti-competitive practices that preventedbanks from offering rival cards. An unfavorable verdict could costMasterCard and Visa hundreds of millions of dollars as suits filedunder antitrust laws can seek triple damages.