Mobile payments firm Monitise today splashed out £109 million to acquire US counterpart Clairmail as the market for banking and shopping by phone hots up.
Under the terms of the all-share deal, Monitise will have a market capitalisation of close to £400 million, with Clairmail representing 26.5%. Both companies specialise in providing back-office technology and software
to allow the processing of mobile payments. Monitise chief executive Alastair Lukies said the takeover “substantially accelerates our already strong position” in America which is expected to be
the world’s largest market for mobile banking.
He said the merged group would be well placed to help banks “defend and extend their position amid the seismic changes being unleashed by mobile”.
Lukies added: “The future of payments, the internet, retail and social networking is all mobile.”
Around one third of the 50 biggest US financial institutions are clients of Monitise or Clairmail. British clients include Royal Bank of Scotland and Lloyds TSB.
The mobile market is still nascent but set to grow rapidly as consumers embrace so-called “wave and pay” technology that allows them to buy goods with a smartphone.
Both Clairmail and Monitise were loss-making on an operating basis last year, falling £28 million into the red on a combined basis, but the merged group should break even next year.
Monitise’s shareholders include credit card group Visa Inc which has 12.3% stake, Visa Europe with 8.7% and Standard Chartered with 4%.
Clairmail would be Monitise’s first acquisition since Lukies founded the firm in 2003 although it has bought out two joint ventures.
