Polcard, which operates in both the merchant acquiring and card issuing sides of the business, is the country’s largest transaction processor. The company reported $44m in revenue last year.
First Data is buying Polcard from lottery company GTECH, a US-based unit of Italian gaming company Lottomatica SpA, and Polish private equity group Innova. GTECH has a 74% stake in Polcard, and Innova owns almost all the rest.
First Data already has a presence throughout Central and Eastern Europe. The company in 2005 bought EuroProcessing International, a processor for banks in the region, and Austrian Payment Systems Services GmbH. First Data also has units in Serbia, Slovakia, and the Baltics.
The European card processing market is less mature than the US market, but First Data and its competitor TSYS have been aggressive in their push into the region. But many European banks have the scale to handle what would usually be outsourced in the US on their own. And the third-party processing market in Europe is largely based around consortiums formed by several banks to handle. Still, the big US processors seem to think that as more business in the region takes place with cards, and as Europe prepares to adopt a common electronic payment system by 2009, there’s a big opportunity.
There’s a fair amount of buying in Europe now, said Anders Maehre, an analyst at Datamonitor. All the countries are smaller and the infrastructure is lower scale, which offers opportunities to transform national infrastructure into something regional or international. First Data is doing this now, especially in Eastern Europe.
