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MarketScreener Homepage  >  Equities  >  Nyse  >  Visa Inc.    V

VISA INC.

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Visa : DOJ sues to block Visa's $5.3 billion purchase of Plaid Inc.

11/05/2020 | 01:14pm EST

CHARLOTTE, N.C. (AP) — The Department of Justice sued payment processing giant Visa Inc. on Thursday to block the company's purchase of financial technology startup Plaid, calling it a monopolistic takeover of a potential competitor to Visa's ubiquitous payments network.

The lawsuit, filed in the Northern District of California, seeks to stop Visa's purchase of Plaid, which at $5.3 billion would have been the second-largest acquisition in the company's history, second only to Visa's buyout of Visa Europe a few years ago.

Plaid provides the infrastructure to allow consumers and businesses to pay directly from their bank account. Services like Venmo, SoFi, Stripe and TransferWise all use Plaid as a way for consumers to send money from their bank accounts to another party without having to use the debit card infrastructure that's largely controlled by Visa and its competitor Mastercard.

Visa earns a small fee from every transaction that is run on its network. The fee varies depending on the card, but debit transactions tend to be cheaper to run on Visa's network than credit card transactions. But those tens of billions of debit card transactions add up, bringing in billions of dollars in revenue for Visa every quarter.

By providing an infrastructure that would bypass the traditional debit card networks, Plaid presented a competitive threat to Visa, the Department of Justice argued in its lawsuit, and without it being an independent company, consumers and businesses would in turn pay higher prices to take Visa debit cards.

“Visa's proposed acquisition of Plaid would forestall this competition, allowing Visa to maintain its monopoly position and supracompetitive prices in online debit,” the lawsuit said.

In a statement, Visa said it strongly disagrees with the DOJ's lawsuit, arguing that Plaid is a payment infrastructure company, not a payment network like Visa.

“This action reflects a lack of understanding of Plaid’s business and the highly competitive payments landscape in which Visa operates,” the company said in a statement

Copyright 2020 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed without permission., source Associated Press News

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Financials (USD)
Sales 2021 23 181 M - -
Net income 2021 11 780 M - -
Net Debt 2021 6 920 M - -
P/E ratio 2021 37,7x
Yield 2021 0,61%
Capitalization 479 B 479 B -
EV / Sales 2021 21,0x
EV / Sales 2022 17,8x
Nbr of Employees 20 500
Free-Float 84,3%
Chart VISA INC.
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Visa Inc. Technical Analysis Chart | V | US92826C8394 | MarketScreener
Technical analysis trends VISA INC.
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Income Statement Evolution
Consensus
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Mean consensus BUY
Number of Analysts 38
Average target price 235,03 $
Last Close Price 205,14 $
Spread / Highest target 31,6%
Spread / Average Target 14,6%
Spread / Lowest Target -5,43%
EPS Revisions
Managers and Directors
NameTitle
Alfred F. Kelly Chairman & Chief Executive Officer
Ryan McInerney President
Vasant M. Prabhu Vice Chairman & Chief Financial Officer
Rajat Taneja President-Technology
John A. C. Swainson Independent Director
Sector and Competitors
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AVAST PLC-1.21%7 450
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