Capital Markets

Visa Plans to Go Public

The credit card company will restructure and merge its entities in the next year.
Stephen TaubOctober 11, 2006

Visa has announced plans to issue shares and go public as part of a sweeping reorganization.

One of the world’s largest credit card organizations, Visa is currently a private association owned by banks. The reorganization will result in a new stock corporation owned by Visa members. Visa is following the lead set by rival MasterCard, whose shares have surged 84 percent since its May initial public offering.

The proposed restructuring will create publicly held Visa Inc. 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; Central and Eastern Europe, Middle East, and Africa.

As part of the restructuring, the majority of Visa Inc.’s board will be independent directors. The company said it is searching for people to fill those roles, as well as a chief executive officer. “Visa expects the proposed restructuring will best position the company to meet the evolving needs of its customers and will accelerate its growth by improving organizational efficiency, addressing certain legal claims that exist in some markets, and increasing access to capital,” it said in a press release.

The IPO probably will happen in 12 to 18 months, said Peter Hawkins, the head of Visa’s restructuring committee during a conference call with reporters, according to the Associated Press.

The announcement comes amid a wider renaissance in the IPO market. According to Bloomberg, so far in 2006, 149 IPOs raised $32.2 billion, the most since 2000.

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