Global Payments buying one business, selling another in B2B push

Global Payments has cut deals to add one business and divest another as it, like many of its rivals, rushes to automate business-to-business transactions.

The Atlanta-based payments processor has agreed to acquire EVO Payments, another Atlanta-based processor, for about $4 billion. The deal, which is expected to close in early 2023, would give Global Payments an entree into new geographic markets and would help it augment its B2B software.

Concurrently, Global Payments is selling Netspend's consumer business to Searchlight Capital for $1 billion, while retaining Netspend's B2B assets. In another move, Silver Lake Partners is investing $1.5 billion in Global Payments and will receive a seat on Global Payments' board.

The deals and the investment were announced Monday.

EVO has more than 500,000 clients in North America, South America and Europe. The combined companies would have about 1,500 financial institution clients and 4.5 million merchant clients. Global Payments initially acquired Netspend, which specializes in prepaid cards, as part of its $21 billion merger with TSYS in 2019. 

Global Payments has been building its business services over the past year, including striking a deal with Google to jointly develop technology for small businesses. The two firms have adapted Google Workspace, Google My Business and Google Ads for Global Payments' clients, while Global Payments has acted as a merchant acquiring partner for Google. The partnership also includes enabling merchants to launch e-commerce sites and accept digital payments quickly, with artificial intelligence-powered marketing. 

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Global Payments is operating in a market that includes firms such as Stripe, which has expanded its ability to provide services beyond online payments over the past two years. PayPal and Block, the former Square, also offer business services such as merchant credit added and back-office products such as inventory management. Global Payments also competes with financial technology companies such as FIS and Fiserv, which have made large acquisitions over the past few years to expand technology that serves both merchants and card issuers. 

Upon completion of the Evo deal, merchant solutions would represent about 75% of Global Payments's net revenue with issuer solutions, including B2B, making up the remaining 25%, Global Payments CEO Jeff Sloan said in a news release.