The Hongkong and Shanghai Banking Corporation Limited has entered into an agreement with Global Payments Inc., a provider of electronic transaction processing solutions, to transfer the bank’s merchant card processing services in the Philippines to Global Payments Asia-Pacific Limited, a joint venture in which Global Payments holds a 56% interest and HSBC holds the remaining 44%. Under the terms of the agreement, the merchant business was valued at approximately US$20 million and HSBC will receive from Global Payments a cash consideration, equating to its 56% interest, of approximately US$11 million at current exchange rates.
The deal, which is expected to be completed by the end of September 2008 and is subject to regulatory approval and certain customary closing conditions, expands the joint venture’s direct acquiring processing capabilities into the Philippines.
HSBC and Global Payments recently announced an agreement for a joint venture in the UK, and the two companies also have sales-and-referral agreements in the United States and Canada.
Global Payments Asia-Pacific (Philippines) will be based in Bonifacio Global City and have an initial complement of about 20 employees. No redundancies are expected.
Under the new arrangement, the Philippines will be included in the current ten-year marketing alliance under which HSBC exclusively refers new merchant customers to the joint venture for payment processing services.