Industry consolidation continues as NCR has announced plans to acquire JetPay for $184 million. This deal is the latest in a string of transactions involving legacy players looking to build out their ability to deliver integrated payments solutions to merchants.
NCR is best known for hardware solutions, such as ATMs and POS terminals. JetPay is a payments provider that offers vertically integrated payments and payroll solutions to corporate and government clients. It operates as a payment facilitator.
In a press release, the companies said that NCR will integrate JetPay’s platform into its POS solutions for retail and hospitality. The deal will help NCR grow recurring revenue and enhance the mix of services it provides its customers, they said.
“This deal is more confirmation of the trend we’ve been seeing in the last several years,” Rick Oglesby, president of AZ Payments Group, told PaymentFacilitator.
“Payments and B2B software are becoming inseparable. Small to midsized software vendors are becoming PFs. Larger payment processors are buying software companies, and now large software vendors are buying payments companies. The market has realized that there is huge equity value in owning the integration. Arms-length referral relationships are no longer enough,” he said.
Indeed, the companies highlighted similar points in their announcement.
“NCR’s acquisition of JetPay reflects an important trend in consolidation in the payments ecosystem. This acquisition allows NCR to couple stickier, feature-rich POS and payment acceptance applications with payment processing,” said Rivka Gewirtz Little, research director, Worldwide Payment Strategies, IDC, in the release.
“Additionally, both NCR and JetPay have provided services to the SMB market where retailers are likely to be open for the adoption of a unified POS and payments processing offering. This consolidated offering means maintaining simpler relationships with fewer vendors without compromising on features,” Little said.
Michael D. Hayford, NCR President and CEO, referred to the JetPay acquisition as a strategic initiative for the company.
“Enabling payments as part of our transactions is part of our long-term strategy to create integrated value for our clients,” he said.
The companies expect the transaction to close by the end of this year.