Private equity eyes Moneris U.S. in second round of auction

The Moneris U.S. auction is in the second round, with some expecting private equity to emerge the winner.

Remaining bidders include Genstar Capital and CVC Capital Partners, a banker said. GTCR was also looking at Moneris but it’s not clear whether the firm is still vying for the payment processor, a second banker said. Warburg Pincus dropped out while Blue Pay, a portfolio company of TA Associates, is also out, the sources said.

Among strategics, Vantiv is bidding but Cielo SA is not, sources said. The status of First Data Corp is unclear, with some sources saying the company is pursuing Moneris U.S. but others saying no.

Final bids for Moneris are due in mid-August, the first banker said.

In May, Buyouts first reported that Moneris Solutions Inc had put its U.S. business up for sale. RBC and Bank of Montreal established Moneris as a joint venture in December 2000. Toronto-based Moneris processes more than 3 billion credit and debit card transactions a year for more than 350,000 merchant locations across North America, the company’s website said. Moneris employs more than 1,300 people.

Moneris’s U.S. operations are based out of Schaumburg, Illinois. They were originally known as Harris Bank Merchant Services/the Charge-It-System. RBC and BMO are advising on the auction of Moneris U.S., Buyouts reported.

Bloomberg News reported earlier this month that a sale of Moneris U.S. could fetch as much as $600 million. Moneris U.S. will likely sell for less, around $450 million, sources told Buyouts Thursday. Bloomberg also said that Silver Lake Management, Welsh Carson Anderson & Stowe and Advent International were also pursuing Moneris. It’s unclear whether any of those are involved.

Executives for Warburg, RBC, Genstar and Silver Lake declined comment. BMO, GTCR, Advent, Vantiv, and CVC could not immediately be reached for comment.

Action Item: To contact Moneris email customer.relations@moneris.com.

An employee swipes a customer’s credit card through the card reader at a restaurant in Tokyo February 19, 2005. Photo courtesy Reuters/Issei Kato