InterActiveCorp Finalizes LendingTree Acquisition

IAC/InterActiveCorp, formerly USA Interactive, completed its acquisition of LendingTree at the close of market on Friday. So far this year, IAC has acquired Expedia, Ticketmaster, uDate.com, and Hotels.com. Rumors hit the street last week that IAC might be interested in acquiring DoubleClick. The IAC-Lending Tree transaction is valued between $626 million and $734 million, and was a stock-for-stock transaction. During the second quarter, LendingTree reported revenues of $45.0 million and net income of $7.6 million. LendingTree has more than 200 participant lenders and has facilitated nearly $55 billion in closed loans since 1996 including credit cards. The deal represents IAC’s entry into financial services and real estate verticals. IAC has an existing base of nearly 40 million unique monthly Internet users. Doug Lebda, Founder and CEO, and Tom Reddin, President and COO, will continue in their current positions, as will other key members of the senior management team. (CF Library 5/6/03; 7/25/03)

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CARPATAIR & UATP

Carpatair has become an official merchant of Universal Air Travel Plan. Carpatair is a private Romanian-Swiss regional airline based in Bucharest. It also has commercial and operational offices in Bacau, Cluj, Sibiu, and Timisoara. UATP is owned by 21 shareholder airlines. UATP accounts are actively issued by 15 member airlines and accepted as a form of payment for corporate business travel by more than 200 airlines worldwide.

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Americans Would Revolt Against Merchant Fees

If U.S. merchants were permitted to charge an extra fee for using a credit card to make a purchase, the impact on domestic credit card volume could be enormous. More than 95% of Americans say they would switch back to checks and cash if merchants added a 1% to 3% fee to their credit card purchases, a practice now permitted under Australian law. The findings come from an informal poll of 1,038 participants, conducted during July on CardWeb.com’s home page. New credit card reforms that became effective in January permit merchants to recover their card costs from consumers. VISA and MasterCard have sought to overturn the new Reserve Bank of Australia regulations, and are now awaiting a decision from the Federal Court of Australia. VISA and MasterCard are also facing possible regulation of interchange fee practices in the UK, Poland, Switzerland, and New Zealand. According to data released by the Reserve Bank of Australia in July, Australians charged $11.7 billion during May, a weak 4.5% increase over the previous year. By comparison, credit card volume between May 2001 and May 2002 increased 41.3%, nearly ten times the current growth rate. (CF Library 7/2/03; 7/21/03)

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ID WORKS 4.1

Datacard Group’s flagship identity software is now available in French, German, Japanese and Spanish, in addition to English. Additional language options for the Datacard ID Works v4.1 identification software will allow multi-national organizations to tailor their ID and badging programs to meet regional needs and take advantage of the new vertical ID Works solutions to be released later this year.
Datacard ID Works software is used for a variety of identity applications worldwide, including corporate and government ID, membership, customer loyalty programs and more. Datacard sells the software separately and bundles it with card printers, cameras, biometrics devices and other peripherals to create fully integrated ID systems.

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NPC Holds $1 Billion in Unflown Airline Tickets

National Processing Company reported last week it has processed approximately $490 million of tickets purchased, but as yet unflown, for United Airlines, that could be subject to charge-back, if the airline liquidates. However, NPC says the risk of a material loss under the chargeback rules is not probable at this time. If United completely folds it is likely other airlines will honor the tickets. NPC also reported it also has processed approximately $441 million of tickets purchased, but as yet unflown, for another undisclosed airline, that could be subject to charge-back. Reportedly, the second airline is Continental. In May 2002, NPC announced its decision to discontinue processing debit and credit card transactions for the airline industry. The two remaining contracts currently in effect have expiration dates of April 2004 and November 2005. During the second quarter, the Company’s obligation to process card transactions for two other airline merchants, including U.S. Airways, ceased with these merchants transitioning to new processors. At the end of the second quarter, the estimated dollar value of tickets purchased, but as yet unflown, under these concluding contracts was approximately $151 million.

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NEW ICMA MEMBERS

Bersenbrueck-based PCU Mefema and Leverkusen-based Bayer Polymers have joined the International Card Manufacturers Association as Associate Members – Suppliers. MK Smartcard Joint Venture Company of Hanoi, Vietnam has also joined a Principal Member – Card Manufacturers. Other new Principal Members – Card Manufacturers include Production Services Associates of Deerfield, Illinois and Sandia Imaging of Arlington, Texas. Schuster Flexible Packaging of Commerce, California and Coding Products of Kalkaska, Michigan have joined as Associate Members – Suppliers. ICMA is a non-profit association of plastic card manufacturers, personalizers and related industry participant more than 230 members globally.

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InterCept Revenues Up 16%, Income Impacted by SLMsoft

Atlanta-based InterCept reported second quarter revenues of $64.1 million, a 16.3% increase compared with 2Q/02. However, net income for 2Q/03 totaled $3.0 million, compared to $5.1 million one year ago. The company took a $3.5 million charge during the quarter after SLMsoft Inc., which owed InterCept $7.2 million on a loan, filed bankruptcy. Revenues from Financial Institution Services increased 19.4% to $48.6 million. Revenue from Financial Institution Services increased due to the acquisition of item processing centers in July 2002 and internal growth. Total revenues from Merchant Services grew 7.6% to $15.5 million. Revenue from Merchant Services was higher in 2Q/03 than in the second quarter of last year as a result of the acquisitions of iBill in April 2002 and EPX in May 2002, offset by customer attrition in the merchant base. For complete details on InterCept’s 2Q/03 results visit CardData ([www.carddata.com][1]).

[1]: http://www.carddata.com

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MasterCard Revenues Up 24%, Profits Down 11%

MasterCard International reported Friday that its second quarter net income dropped 11.2% even though 2Q/03 revenues climbed 23.7% to $556.9 million, compared to one year ago. The nation’ second largest card network said that $79 million of the $107 million increase in second revenues was due to its acquisition one year ago of MasterCard Europe. The decline in net income was impacted by a 29% rise in general and administrative expenses to $281.0 million, and a 22% increase in advertising and market development expenses to $195.4 million. MasterCard says the $63 million increase in general and administrative expenses was due primarily to its acquisition of MasterCard Europe ($39 million) and personnel expenses ($22 million). The network noted that the $35 million increase in advertising and market development expenses included $34 million for its MasterCard Europe acquisition. For complete details on MasterCard’s 2Q/03 results visit CardData ([www.carddata.com][1]).

[1]: http://www.carddata.com

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Spiegel’s July Catalog and e-Commerce Sales Down 39%

The Spiegel Group reported Friday that its direct net sales (catalog and e-commerce) for July declined 39% compared to last year, due to ongoing negative effect of the company’s decision in early March to cease honoring the private-label credit cards (Eddie Bauer, Spiegel Catalog and Newport News cards) issued by First Consumer National Bank. The Group’s net sales from retail and outlet stores fell 17 percent compared to last year, primarily reflecting the impact of store closings as well as the decline in comparable-store sales. At the end of July, the company’s store base was 18 percent lower than last year. Year-to-date the company has closed 80 Eddie Bauer retail and outlet stores, 18 Spiegel outlet and clearance stores and nine Newport News outlet stores. The majority of these store closings were a result of the company’s ongoing reorganization process.

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Transaction Systems Architects Under SEC Investigation

Omaha-based Transaction Systems Architects confirmed Friday that the SEC has issued a formal investigation into the company’s restatement of past financial results. The Company announced today that it has been informed that the Securities and Exchange Commission has issued a formal order of private investigation as to matters relating to the restatement. The Company will continue to cooperate fully with the Securities and Exchange Commission.

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Intelli-Check Names Congressman to the Board

NY-based Intelli-Check has named former Wisconsin Representative to the Unites States Congress, Jim Moody, to its Board of Directors. Mr. Moody served on the powerful Ways & Means Committee which oversees the entire federal tax system, nearly two thirds of federal spending, including Social Security and Medicare, as well U.S. trade laws and federal debt management, during his five terms in Congress. Mr. Moody is currently with Morgan Stanley in Washington, DC. Previously, he served as president and CEO of InterAction, an association of U.S. organizations working overseas in economic development and humanitarian relief.

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