Visa plans IPO aimed at raising over $18 bln
Visa Inc, the world's biggest electronic payment processing company, announced on Monday that it was planning an initial public offering (IPO) in the United States, saying it hoped to raise over 18 billion dollars.business Updated: Feb 25, 2008 19:22 IST
Visa Inc, the world's biggest electronic payment processing company, announced on Monday that it was planning an initial public offering (IPO) in the United States, saying it hoped to raise over 18 billion dollars.
Visa, which processes payments for credit and debit cards, said it plans to offer just over 400,000 shares for public purchase. It expects its shares to be priced at between 37 and 42 dollars per share.
The San Francisco-based company said in a statment that it plans to launch its IPO as soon as possible.
Investors will be able to purchase shares in Visa from a pool of 447 million shares of Class A stock the company intends to sell.
The company has hired a group of well-known investment banks to support its IPO, including Goldman Sachs, JP Morgan and HSBC Securities (USA) Inc.
Visa is one of the world's most recognized electronic payment brands.
The company claims its brand is accepted at over one million automated teller machines (ATMs) around the world and that people using its branded cards can access cash in local currency in over 170 countries.
Visa made the announcement in a regulatory filing with the Securities and Exchange Commission.
The electronic payment facilitator makes money from the fees it charges clients to process their payments. Visa's unaudited operating revenues for the three months ended December 31, 2007 were 1.5 billion dollars.
The company does not issue credit or debit cards, set fees or determine interest rates that cardholders are charged for using their bank cards.
Visa's planned IPO comes amid a slowdown in such share offerings, due in part to a slowing US economy and a credit crunch sweeping the financial markets.
Virgin Mobile USA's IPO in October raised around 412 million dollars and the Blackstone Group, one of America's biggest private equity firms, raised around 4.13 billion dollars through a partial stock offering in June of last year.
Visa plans to launch its IPO amid a major shift from paper-based payments, such as cash and checks, to card-based and other electronic payments. The company said this shift was being driven by "significant growth" in card-based payments globally.
Visa's payment brands include Visa, Visa Electron, PLUS and Interlink.