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MasterCard acquires DataCash for $520 million in cash

By Associated Press, August 28, 2010

PURCHASE, N.Y. -- MasterCard is looking to tap into the growth of online payments worldwide.

The company said Thursday that it will pay $520 million in cash for DataCash Group, which provides merchants with electronic payment and fraud prevention services.

The move is expected to help MasterCard bolster online use of cards that bear its name, particularly in Europe and Asia.

DataCash, based in London, has 362 workers and posted $58 million in revenue last year. It currently provides services primarily to European businesses.

MasterCard says the buyout will cut fourth-quarter net income by 5 cents a share. For the fiscal year 2011, the transaction is expected to break even, and to add to net income in 2012.

MasterCard's much larger rival, Visa, made a similar purchase earlier this year. Visa's $2 billion acquisition of CyberSource in April was also intended to boost use of its branded cards, in part by providing fraud fighting technology.

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