France-based Atos Origin has acquired Mumbai-based payment processing firm Venture Infotek Global Pvt Ltd in an all cash deal.

The acquisition will give Atos entry in the Indian payment market, while promoters of Venture Infotek decided to exit as they felt that the business is likely to be capital intensive in future.

The company will be integrated in to Atos Wordline, the specialised entity of Atos Origin in Hi-Tech Transactional Services (HTTS) and electronic payments in order to optimise the synergies particularly for the portfolio of offerings.

Atos Origin is a IT firm providing Hi-Tech transactional services, consulting, systems integration and managed services to deliver business outcomes globally and also provides payment services segment globally under its subsidiary, Atos Worldline. Its annual revenues are EUR 5.1 bn and it employs 49,000 people. Atos Origin is the worldwide IT partner for the olympic games and has a client base of international companies across all sectors.

Khaitan & Co acted as the legal counsel to Venture Infotek.

Transaction Reference: BS

The deal is likely to give an exit to AIM-listed Kubera Cross Border Fund, which invested $21 million for a 54% stake in Venture Infotek.

Venture Infotek promoted by Dhruv and Piyush Khaitan, deals in merchant acquiring, card processing, loyalty programs, government benefits programs and ATM management on behalf of the Indian Banks and major retailers and it is operated from all across India.

In the early ’90s, the promoters of Venture Infotek set up a joint venture with Equifax of US to provide complete back office solutions to a bank issuing credit cards.

A few years later, the promoters bought out Equifax following investment by some private equity funds.

This year, Venture Infotek acquired Technonet Technologies Ltd., a payment gateway service provider, and has enhanced the technology platform of ‘Eazy2Pay’ its payment gateway to comply with all the latest Visa, MasterCard and RBI guidelines related to Internet Commerce.

This includes, securing all transactions using Triple Data Encryption Standard (3DES) keys to encrypt cardholder information and Merchant Plug-In (MPI) to facilitate 3D-Secure verifications which would enable the merchants to complete their transaction without any fear of being defrauded by miscreants using stolen card data.

‘Eazy2Pay’ interfaces with the Internet shopper, web merchant and banking systems in a secured environment managed by Venture Infotek to facilitate online payments. The payment gateway is a real-time, scalable Internet payment platform, which allows retailers to authorize, process and manage online payments.

Venture Infotek, which had bagged a large order for debit card issuance from State Bank of India, had issued a record 20 million debit cards for the bank till March. Some of the recent client additions of the firm include IDBI, PNB, MasterCard and Diners.

In the payment space, last year KKR-owned First Data Corporation acquired ICICI Bank’s network of credit card swipe machines and the bank’s back office processing division for $90 mn. ICICI Bank had hived off its 1.5 lakh swipe machines into a separate company — ICICI Merchant services, and sold 80% of the shares of this company to KKR.

Venture Infotek is in the same line of business as ICICI Merchant Services, besides a host of other payment-related services. The company provides end-to-end card payment processing solutions for both — banks that issue credit cards and those banks with whom the merchants having the point-of-sales terminals.

The key difference between Venture Infotek and ICICI Merchant Services is that Venture Infotek does not own point of sales terminals and most of the swipe machines managed by the company belong to Axis Bank.

Venture Infotek also gets significant revenues from managing petro credit cards for state-owned oil companies. The company processes 150 million card transactions annually worth Rs.35,000 crore. A host of banks also outsource their billing and card issuance programmes to Venture Infotek, which issues over 50 lakh payment and loyalty cards.

Kubera Cross Border Fund invests in the sectors of auto, BFSI, pharma, education and technology. Its Indian portfolio includes companies like Infotech Enterprises, Spark Capital, Essel Shyam Communication, Ocimum Biosolutions and others.

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