Chiquita’s $10 billion deal with Avantix is a winner for Chesapeake
The $10.5 billion acquisition of Chesapeake Payment Systems by Avantax is a win for Cheslake, but not for the company’s shareholders.
The acquisition is expected to save Chesapeake more than $2 billion, but Avantox CEO Jeff Siegel says he’s worried about the effect on the company, its shareholders and the Chesapeake ecosystem.
The deal has been shrouded in secrecy since it was announced on Thursday.
In its most recent earnings call, Avantazs board of directors acknowledged the “potential negative impact on our business,” but didn’t specify how the deal would affect Chesapeake’s financials.
Avantax has been a leader in the payment industry, which has grown to about a billion people by the time it acquired Avantacom, a company that was acquired by PayPal.
While Avantafile and Avantavoice are competing for the business, Chesapeake is still in the early stages of establishing itself as a payments powerhouse, and its acquisition of Avantas payment system will allow the company to do so.
“Our goal is to be the payment service of choice for the U.S. and globally,” Siegel told investors at a conference call on Thursday, according to Bloomberg.
“I don’t think it will change much in the short term.”
Avantix, which is based in San Francisco, was founded in 2004 and has offices in San Diego, Los Angeles and Atlanta.
The company operates more than 3,500 payment systems around the world, including in Mexico, the Philippines, India, China and Brazil.
Avantaiks payment systems offer credit cards, bank accounts, debit cards, money orders, prepaid cards, and even bitcoin.
“Chiquita is proud to work with AvaTix on this acquisition and to remain an important partner for Chesaltech in the payments market,” CEO James Ransom said in a statement.
“This is an exciting time for Cheschaltech and the ecosystem as a whole, and we look forward to continuing to build on our long-standing partnership with Avastix.”