Today before the opening bell,
Net Element announced that it has signed definitive documentation to acquire
PayOnline, a leader in online transaction processing services and payment
technology, for up to $8.4 million in total consideration.
The closing payment is $3.6
million cash, which has been paid into escrow, and $3.6 million in stock. There
can also be additional consideration from earn-out incentives of up to $1.282
million in cash and stock based on performance.
PayOnline processes online
payments for over 10 million active consumers and thousands of merchants in the
Russian Federation, Europe and Asia. Net Element’s plan is to integrate the
PayOnline leading payments platform into its existing global
payments-as-a-service network to expand its transaction processing offerings.
Notably, the company will also be able to sell its mobile payment services to
PayOnline’s merchants.
The 2014 McKinsey Global
Payments Map, released October 2014, states Russia is the world’s 6th largest
payments market, accounting for $50 billion in payments with a rapidly growing
online population. Card issuance is growing at 30% per year.
Once the acquisition is
finalized, Net Element global merchants will have access to a broad array of
value-added services, including card2card transfer, payment split and the
highest level of data security (Validated Level 1 PCI DSS Compliance). Also, because
of their direct agreements with European and Russian Federation banks,
PayOnline’s thousands of merchants will be able to transact in the U.S. while
Net Element’s U.S. merchants will have an ability to transact in Asia, Europe
and Russia.
“PayOnline and Net Element’s
assets are highly complementary and we can now leverage them to grow revenues
by attracting more merchants and consumers to our omni-channel payments
platform,” stated Oleg Firer, CEO. “Well deserved congratulations to all
involved in bringing this transaction to a successful signing.”
Net Element expects this
acquisition to be profitable this year.
For more information on Net
Element, visit www.netelement.com
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