https://www.justice.gov/opa/pr/visa-and-plaid-abandon-merger-after-antitrust-division-s-suit-block

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Justice News

Department of Justice
Office of Public Affairs
---------------------------------------------------------------------
FOR IMMEDIATE RELEASE
Tuesday, January 12, 2021

Visa and Plaid Abandon Merger After Antitrust Division's Suit to
Block

Decision to Terminate Deal Preserves Competition

The Department of Justice announced today that Visa Inc. and Plaid
Inc. have abandoned their planned $5.3 billion merger.

The department filed a civil antitrust lawsuit on Nov. 5, 2020, to
stop the merger, alleging that Visa is a monopolist in online debit,
charging consumers and merchants billions of dollars in fees each
year to process online payments.  Plaid, a successful fintech firm,
is developing a payments platform that would challenge Visa's
monopoly.  According to the complaint, the transaction would have
enabled Visa to eliminate this competitive threat to its online debit
business before Plaid had a chance to succeed, thereby enhancing or
maintaining its monopoly.  The case was scheduled for trial in the
U.S. District Court for the Northern District of California on June
28, 2021.  As a result of Visa and Plaid's decision to terminate
their merger agreement, the United States has filed a Joint
Stipulation of Dismissal.

"In a victory for American consumers and small businesses, Visa has
abandoned its efforts to acquire an innovative and nascent
competitor," said Assistant Attorney General Makan Delrahim of the
Justice Department's Antitrust Division.  "American consumers and
business owners rely on the internet to buy and sell goods and
services, and Visa - which has immense power in online debit in the
United States- has extracted billions of dollars from those
transactions.  Now that Visa has abandoned its anticompetitive
merger, Plaid and other future fintech innovators are free to develop
potential alternatives to Visa's online debit services.  With more
competition, consumers can expect lower prices and better services."

Assistant Attorney General Delrahim continued, "The department is
grateful for the team of dedicated civil servants, lawyers and
economists, who carefully reviewed this merger and pursued the
litigation, ultimately building a case that the merger would
extinguish a nascent competitor, further entrench Visa's dominance in
the online debit market, and harm consumers.  Their diligent efforts
to prosecute this case convinced the parties to abandon the deal
rather than face us in court.  We wish both companies well as they
innovate and work to provide their products to American consumers." 

Visa Inc. is a Delaware corporation headquartered in Foster City,
California.  Visa is a global payments company that operates the
largest debit network in the United States.  Visa's 2019 revenues
were approximately $23 billion. 

Plaid Inc. is a Delaware corporation headquartered in San Francisco,
California.  Plaid is a financial services company that operates the
leading financial data aggregation platform in the United States.  In
2019, Plaid earned approximately $100 million in revenues. 

Topic(s): 
Antitrust
Component(s): 
Antitrust Division
Press Release Number: 
21-38
Updated January 12, 2021
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