Visa Europe Plays Own IPO Card

SAN FRANCISCO - Credit unions around the country have begun receiving stock, Class B shares, in the newly reorganized Visa Inc., representing the roll-up of Visa USA, Visa Canada and Visa International. But member/owners of Visa Europe have voted not to participate in the huge cards deal, a prelude to an initial public offering expected later this year. Instead, member financial institutions in Europe will receive stock in the new company, but will continue to run an independent payments network under a licensing agreement with the cards giant. More than 2,000 credit unions will receive Visa stock that could be worth as much as $1 billion in the reorganization. Many of the same credit unions reaped millions in profits after receiving stock in MasterCard in that company's 2005 IPO. Those shares have been among the hottest on Wall Street since then, quadrupling from their original $39-a-share price to over $160. Observers expect shares in Visa, a much bigger company, to go public at at least $50. In conjunction with the reorganization, Robert Hackney, president of Card Services for CUs, who was the credit union representative on the board of Visa USA, stepped down from the panel. Both payments networks are controlled by the biggest banks in the country, including JP Morgan Chase, Bank of America, Citibank and Wells Fargo.