Visa follows Master

13 October 2006

The world's largest consumer credit card payments operator Visa International, has announced plans to restructure its organization. Under the restructuring, Visa will create a new public global corporation called Visa Inc and then offer its share in an initial public offering.

Visa products currently generate more than $4 trillion in sales volume theroughout the world.

Last May, rival MasterCard went public with an IPO and since then its shares have soared from an opening day price of $46 to the extent that several analysts downgraded the stock as overvalued.

Visa, an association owned by banks, had initially said it would not follow MasterCard's lead and instead sought to add more independent directors to its board and modify its operating rules.

Under the proposed restructuring unveiled this week, Visa Inc. will be created through a series of mergers involving Visa Canada, Visa USA and Visa International, which includes the operating regions of Asia Pacific, Latin America and the Caribbean, and Central and Eastern Europe, Middle East and Africa.

The reorganisation will result in a new stock corporation owned by Visa members. After the mergers are complete, the global corporation intends to begin the IPO process and list its shares on a major stock exchange.