American Express Company, has agreed to acquire Revolution Money, a Revolution LLC company. The purchase price is expected to be approximately $300m. Upon closing, Revolution Money would operate as a subsidiary of American Express.
Jason Hogg, founder and chief executive officer of Revolution Money, will continue as president and chief executive officer. Ted Leonsis, angel investor, major shareholder and chairman of Revolution Money, will become a special advisor to American Express working with Mr Chenault on overall digital and online payments strategy.
Revolution Money provides secure payments through an internet based platform. No names or account numbers appear on Revolution cards and transactions are authorized by using a PIN number. The company’s online person-to-person payment accounts are FDIC insured and suited for social and instant messaging networks. It also offers a prepaid card linked to those accounts that can be used for offline payments or to withdraw cash from ATMs throughout the United States.
Kenneth Chenault, chairman and chief executive officer of American Express, said: “New payments products and platforms are evolving rapidly and it’s important for us to keep identifying technologies that can extend our leadership beyond the traditional payments arena. While Revolution Money is a young and relatively small company, we believe it has good potential.
“It’s run by an accomplished management team who have quickly developed some good e-payment offerings. Joining with American Express will help unlock their potential, while allowing us to deliver competitive online payment products more rapidly and efficiently.”
Mr Hogg, said: “Since our inception our sole goal has been to build a payments platform that can help transform the industry. Becoming part of American Express will enable us to reach that goal by scaling our technology and business and providing even greater consumer benefits. I, and the Revolution Money employees who helped build our company, are honored to be joining the American Express family and we are excited about what the future holds.”
The transaction, which is subject to regulatory review, is expected to close in the first quarter of 2010.
