Neovia Financial PLC, the U.K. merchant processor behind the NetTeller prepaid card service, said it will gain a "meaningful" North American operation with its purchase of Optimal Payments.
The $50 million deal, announced Jan. 20, "dramatically diversifies and broadens Neovia's merchant base" and "provides a strong North American presence and fuller exposure to rapidly growing e-commerce markets," Neovia said in a press release.
Neovia said it intends to change its name to Optimal Payments PLC on closing the deal. It is set to close by the end of May.
Neovia said it wants to use the Optimal acquisition as a springboard to become stronger in alternative payments. Neovia's products include electronic wallets, prepaid cards and direct funds-transfer services, which serve as alternatives to traditional card-based payments. "We will continue to identify and focus on niche markets where we can generate higher margin business as a result of our specialist alternative payment [services] or superior risk management capabilities," it said. Examples include online dating services.
About 60% of the new entity's transactions would come from standard debit and credit card payment processing and about 40% from prepaid products, Neovia said. About 75% of Neovia's volume now comes from its proprietary merchant prepaid card transactions and the rest comes from debit and credit card payments, according to a presentation about the Optimal deal.
North America should provide about 13% of the combined company's overall revenue.