E-payments solution provider VeriFone has
acquired rival Hypercom for a reported $485m after a spectacular
u-turn from both parties sealed the deal.

In September this year Hypercom aggressively
rejected an initial bid from VeriFone, reported to be worth $337m,
deeming it to be “much too low”. It also claimed VeriFone was
trying to “disrupt its business after it had taken market share
from the company.”

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Philippe Tartavull, CEO and president of
Hypercom said the company has increased revenue from $290m to $450m
over the last three years, which is certainly cause for VeriFone to
up its bid.

It seems, however, Hypercom’s presence in
Europe proved to be VeriFone’s main incentive to acquire its
rival.

“Consistent with our vision as a global leader
in secure electronic payment solutions, we have placed strategic
focus on replicating our North American success in key markets in
continental Europe,” said Douglas G. Bergerson, CEO of
VeriFone.

“Hypercom has established itself in a number
of important European markets, and this acquisition is an excellent
and complementary way for us to accelerate our overseas growth,
increase innovation and build value for our shareholders.”

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Under the terms of the transaction, which has
been unanimously approved by the boards of both companies, Hypercom
shareholders will receive a fixed ratio of 0.23 shares of VeriFone
common stock for each Hypercom share they own, valued at $7.32 per
share based on the closing price on 16 November. VeriFone will also
assume Hypercom’s outstanding warrants and stock options in the
transaction.