We use cookies to understand how you use our site and to improve your experience.
This includes personalizing content and advertising.
By pressing "Accept All" or closing out of this banner, you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties.
You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies.
In addition, whether you "Accept All," Deny Optional," click the X or otherwise continue to use the site, you accept our Privacy Policy and Terms of Service, revised from time to time.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
RY & BMO Consider the Sale of Canada Payments Venture Moneris
Read MoreHide Full Article
Key Takeaways
Royal Bank of Canada and Bank of Montreal may sell payments venture Moneris for about $2B.
Moneris processes one in three Canadian transactions and serves 325,000 merchant locations.
Annual revenues of about $700M support Moneris' estimated valuation of nearly $2B.
Royal Bank of Canada (RY - Free Report) and Bank of Montreal (BMO - Free Report) are mulling over the potential sale of their Canada payments joint venture, Moneris, in a deal that could value the business at roughly $2 billion. This was first reported by Reuters, citing four people familiar with the matter.
Moneris, founded in 2000 by RY and BMO, is one of Canada’s largest payment processors, managing roughly one out of every three business transactions across the country. Moneris generates roughly $700 million in revenues annually. According to its website, the company provides digital, mobile and in-store payment solutions to around 325,000 merchant locations.
The sale isn’t certain, and Royal Bank of Canada and Bank of Montreal may still decide to keep part or all of the business.
In recent years, the rapid digitization of the North American payments industry and the need for regular capital investment to stay competitive have led many banks to divest their payments operations. Buyers have often included payments companies, expanding through mergers and acquisitions to broaden their reach and services, as well as private equity firms attracted to the recurring fee revenues these businesses generate.
In sync with this, last month, Fiserv Inc. (FI - Free Report) collaborated with TD Bank Group, a subsidiary of Toronto-Dominion Bank (TD - Free Report) , to provide technological support to TD’s merchant business. Further, Fiserv agreed to acquire a part of TD’s merchant processing business in Canada.
RY & BMO Price Performance & Zacks Rank
Year to date, shares of Royal Bank of Canada and Bank of Montreal have gained 13.2% and 16.5%, respectively, underperforming the industry’s 35.2% growth.
Image: Bigstock
RY & BMO Consider the Sale of Canada Payments Venture Moneris
Key Takeaways
Royal Bank of Canada (RY - Free Report) and Bank of Montreal (BMO - Free Report) are mulling over the potential sale of their Canada payments joint venture, Moneris, in a deal that could value the business at roughly $2 billion. This was first reported by Reuters, citing four people familiar with the matter.
Moneris, founded in 2000 by RY and BMO, is one of Canada’s largest payment processors, managing roughly one out of every three business transactions across the country. Moneris generates roughly $700 million in revenues annually. According to its website, the company provides digital, mobile and in-store payment solutions to around 325,000 merchant locations.
The sale isn’t certain, and Royal Bank of Canada and Bank of Montreal may still decide to keep part or all of the business.
In recent years, the rapid digitization of the North American payments industry and the need for regular capital investment to stay competitive have led many banks to divest their payments operations. Buyers have often included payments companies, expanding through mergers and acquisitions to broaden their reach and services, as well as private equity firms attracted to the recurring fee revenues these businesses generate.
In sync with this, last month, Fiserv Inc. (FI - Free Report) collaborated with TD Bank Group, a subsidiary of Toronto-Dominion Bank (TD - Free Report) , to provide technological support to TD’s merchant business. Further, Fiserv agreed to acquire a part of TD’s merchant processing business in Canada.
RY & BMO Price Performance & Zacks Rank
Year to date, shares of Royal Bank of Canada and Bank of Montreal have gained 13.2% and 16.5%, respectively, underperforming the industry’s 35.2% growth.
Image Source: Zacks Investment Research
Currently, Royal Bank of Canada and Bank of Montreal carry a Zacks Rank #3 (Hold) each. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.