WEX, a US financial technology service provider, has agreed to acquire eNett International and Optal for a combined price of around $1.7bn in a cash-cum-stock transaction.
ENett caters to the travel industry with its B2B payments solutions. The company’s virtual account numbers (VANs) are said to enable travel agencies to generate a unique 16-digit Mastercard number that can be used for making quick and efficient payments to travel suppliers with less risk.
As each booking or payment transaction needs a unique number, VANs are a secure way to pay and also for receiving payments, said eNett.
ENett is currently majority-owned by Travelport as part of a joint venture with Optal for more than 10 years. Travelport, which is a travel commerce platform, owns a majority stake in the B2B payments solutions provider.
ENett managing director and CEO Anthony Hynes said: “eNett is thrilled to be entering into this new chapter of offering innovative payments solutions for travel companies globally as part of WEX.
“Customers will benefit from our shared commitment to the delivery of exceptional levels of service, a more comprehensive product suite, and expanded global reach.”
Optal, which is a global banking services partner to eNett, is being purchased from private shareholders by WEX. The company is focused on streamlining B2B transactions.
Optal is expected to give WEX a global issuing capability, a suite of regulatory licenses alongside a technology and banking infrastructure to enable the latter’s expansion into new regulated territories.
The combination of WEX’s travel business with eNett and Optal is expected to further consolidate the former’s position in the global travel marketplace.
The acquisition is also likely to reduce the exposure to macro-economic fluctuations for WEX further while making its travel business geographically diverse. Furthermore, the combination will enable the financial technology service provider to gain a greater footprint in the EMEA and APAC regions.
WEX CEO comments on the acquisition of eNett and Optal
WEX chair and CEO Melissa Smith said: “In particular, this transaction strengthens our position outside of the US, adds a unique but complementary product suite, and brings a talented team with expertise in operating in international markets.
“We are confident this transaction will enable us to accelerate our growth by deepening and expanding our position in the global travel market, broadening our product offerings to more fully address the needs of our Travel customers, and diversifying our business geographically while reducing our exposure to macro-economic factors.”
The total consideration of the transaction is made up of nearly $1.275bn in cash and about two million shares of WEX.
Subject to regulatory approval and other customary closing conditions, the transaction is likely to be closed mid-year 2020.
