The United States Department of Justice is considering filing a lawsuit in a bid to stop Visa’s acquisition of fintech company Plaid over antitrust concerns, the Wall Street Journal reported Tuesday.
What Happened: The Justice Department is already lining up witnesses and could take a final decision in the matter soon, people familiar with the matter told the Journal.
Separately, the department filed a petition in the U.S. District Court for the District of Massachusetts on Tuesday to enforce its call for Bain & Company to cooperate in its investigation into the acquisition.
Bain, a consultant for Visa, has withheld key documents, including ones “that discuss Visa’s pricing strategy and competition against other debit card networks that may be important to the division’s analysis of the proposed acquisition’s effects” from the investigators, DOJ alleged.
Why Does It Matter: Visa announced early this year that it had agreed to acquire Plaid for $5.3 billion — at nearly twice its valuation.
Those watching the deal expressed concerns that Visa’s frontrunner position in the payment solutions business and access to Plaid’s innovative technology through the acquisition could stifle competitors in the fintech space.
Visa processed $2.2 trillion worth of card transactions in the first half of 2020 followed by market peer Mastercard with $942 billion, the Journal noted, based on data from Nilson Report. Plaid has claimed to serve more than 11,000 financial entities and 200 million consumer accounts.
Price Action: Visa stock closed 1.59% lower on Tuesday at $190.06 per share.
This story originally appeared on Benzinga.
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