Craig Kennedy MD, in front of Cuscal signage.

Sydney, 13 October 2014: Cuscal Limited (Cuscal), one of Australia’s leading providers of end-to-end payments, has today announced plans to acquire Strategic Payments Services Pty Ltd (SPS), subject to shareholder approval.

If the transaction is approved it will cement Cuscal’s unique market position as the only independent ADI licensed wholesale payments company to deliver banking capabilities and payments solutions across the entire spectrum of the payments value chain.

Managing Director of Cuscal, Craig Kennedy, said combining Cuscal’s and SPS’s complementary strengths in issuing and acquiring would bring significant opportunities to clients of both companies.

“The future of payments is about real time, mobile and data. This synergistic acquisition will complete our capabilities in the current environment and prepare us for where the market is heading.

“For financial and non-financial organisations that want to connect with the future payments market, Cuscal offers an attractive and scalable non-compete solution built around independence and continual innovation to keep pace with the exciting rate of change,” said Mr. Kennedy.

Following the completion of this acquisition the new entity will represent approximately 10 per cent of the Australian electronic funds transfer (EFT) market, thereby providing healthy competition and greater choice for clients in the process.

“Combining the organic growth of both companies means we can provide payment connectivity to an increasingly diverse range of financial institutions and non-financial institutions through a unique aggregated approach. This will put us in an excellent position to connect to any current and future payment systems,” said Mr Kennedy.

Managing Director, Strategic Payment Services, Simon Stephenson said SPS has successfully carved out an enviable market position as one of the leading independent payment processors in Australia.

“SPS and Cuscal are both strong, innovative payments businesses underpinned by dedicated and talented staff. I am confident the acquisition will create a new, unique and powerful player in the Australian payments landscape delivering growth opportunities and significant benefits for the people and customers of both organisations,” said Mr Stephenson.

It is anticipated that the combined entity would service more than 100 clients across a number of industries including financial institutions, mutual banks, credit unions, insurers, government departments and agencies, and major retail corporations.

The combined infrastructure would support:

  • switching technology that enables issuers and acquirers to access the payment systems
  • a real-time payment platform and 24×7 fraud prevention engine
  • connections to all cards and payment schemes
  • a digital and mobile infrastructure
  • switching for approximately 9000 ATMs, including the rediATM network, one of Australia’s largest ATM networks
  •  a comprehensive merchant management system
  •  comprehensive data analytics capabilities

“The payments industry is radically changing and we already signalled our intent to support its ‘disruption’ when we launched Asia-Pacific’s first mobile Host Card Emulation (HCE) payments app redi2PAY earlier this year.

“Integrating with SPS means we can sharpen our focus and investment in research, development and delivery of market leading technology, as well as continue to offer emerging players a neutral platform to operate from,” Mr Kennedy said.

Under the deal, owners of SPS – Bendigo Bank and Mastercard – will take an approximate 10 per cent stake each of the final combined entity.

“Having Mastercard and Bendigo Bank join our already diverse and large group of shareholders means we continue our long-held commitment to impartial ownership,” said Mr Kennedy.
The transaction to bring the two companies together, which is expected to occur by the end of the year, is subject to shareholder approval at Cuscal’s November AGM.

-ENDS-

About SPS
Since 2006 SPS has achieved an enviable market position as one of the leading independent payment processors in Australia. Its end-to-end solutions include transaction switching, device driving, card management, merchant management, data analysis, back office reporting, settlement and support functions.