Rêv and Searchlight to acquire Netspend from Global Payments

Bertrand Sosa and Roy Sosa, founders of Netspend

Rêv Worldwide, Inc., (Rêv), an international fintech, and a provider of payment technology and software solutions, announced that Rêv, in partnership with funds advised by Searchlight Capital Partners, L.P. (Searchlight), has entered into a definitive agreement to acquire the Netspend consumer business from Global Payments in an all cash transaction valued at $1bn.

What does the acquisition mean for stakeholders?

The acquisition brings back Netspend’s founders, Roy and Bertrand Sosa, who also founded Rêv. The Sosa brothers look to leverage the assets of the two entities to build a high growth company that delivers on a mission of financial empowerment and product innovation.

For Searchlight, this transaction represents yet another exciting partnership with the dynamic fintech entrepreneurs while also being able to support growth and innovation for consumer financial services to underserved markets. With this sale, Global Payments delivers on its commitment to divest itself from Netspend’s consumer business, allowing the organisation to focus on its more essential B2B operations and growth opportunities with Rêv as a partner.

Since it was founded in 1999, Netspend’s consumer business has developed into a leader in the prepaid and debit card space serving millions of clients, processing hundreds of billions in cardholder purchases, and established the largest retail partner network with over 130,000 locations nationwide where consumers can load their prepaid and debit card products. It’s consumer products are also available online via direct-to-consumer mobile and web channels.

What were the executives’ thoughts on the transaction?

Commenting on the deal, Chairman and Chief Executive Officer of Rêv, Roy Sosa said,“We’ve gone full circle, launching programs with partners around the globe in our journey to provide innovative financial services to underserved mass markets. We are very excited by the opportunity to partner with the Netspend consumer team and Searchlight as we deliver new products, expand into new markets and add more value to customers across the world.”

Commenting on the transaction, President of Rêv, Bertrand Sosa said,“The market opportunity for Netspend’s consumer business has always been massive, as evidenced by the history of growth the company has experienced. Now we have a chance to expand upon it globally by leveraging unique synergies we bring along with our entrepreneurial spirit.”

Commenting on the deal, Christopher Cruz, Partner, Searchlight, added “The characteristics of this investment are rare to find. Combining an industry leading operation in Netspend’s consumer business with modern platform technology and digitally native solutions from Rêv unlocks great growth potential by meeting the needs of a significant and sizable market.”

“We look forward to partnering with Roy, Bertrand, and the Rêv team as they continue their mission to financially empower underserved consumers through fintech innovation,” he said.

What is the prepaid cards global landscape?

According to a recent report, the global market for Prepaid Cards, valued at $1.6T in 2020, is projected to reach $2.7T by 2026, growing at a CAGR of 9.6% over the analysis period.

Rêv provides mobile-first payment solutions and offers banking-as-a-service capabilities for partners, such as Etihad Airways, Itaú Private Bank, LATAM Airlines; and direct-to-consumer branded products owned and managed by Rêv, like X World Wallet now available in the U.S.

The deal is expected to close in the first quarter of 2023 subject to relevant regulatory approvals, and customary closing conditions. Jefferies LLC is lead financial advisor, and Nomura Securities International, Inc. serves as financial advisor to Rêv. Paul, Weiss, Rifkind, Wharton & Garrison LLP is representing Searchlight, Gunderson Dettmer is advising Rêv.

Evercore is serving as the financial advisor to Global Payments, where as Wachtell, Lipton, Rosen & Katz is representing Global Payments in the transaction.