By David French
NEW YORK (Reuters) - Global Payments Inc (N:GPN) is exploring a sale of its Netspend unit, aiming to secure a valuation of more than $2 billion for the prepaid debit card business, three people familiar with the matter said on Friday.
The parent, valued at $53 billion, is working with an investment bank on the potential divestment and began marketing Netspend to buyers last month, the sources said on condition of anonymity as the information is private.
Selling Netspend would provide Global Payments with extra cash to invest in core parts of its business and those which are considered key growth drivers for the future, one of the sources added.
A spokeswoman for Global Payments declined to comment.
Founded in 1999, Netspend offers rechargeable debit cards for personal and business usage, a product which is primarily focused on those less well-served by traditional banks and financial institutions.
The Austin, Texas-based company also has partnership agreements with the likes of Walmart Inc (N:WMT), 7-Eleven and Western Union Co (N:WU) to offer branded cards, according to its website.
Netspend was bought in 2013 by Total System Services (NYSE:TSS) (TSYS) for $1.4 billion, which itself was acquired by Global Payments for $21.5 billion in 2019 amid a raft of blockbuster consolidation deals among the largest U.S. payment processors.