MasterCard International has reached an agreement in principle with the other shareholders of Mondex International to assume full ownership of Mondex International (MXI) and direct control of all of MXI’s operations and management.
The proposed agreement, which is subject to the final approval by MXI shareholders, would increase MasterCard’s ownership share from the current 58 percent.
Under MasterCard’s management, MXI will continue providing service to the MULTOS consortium – the open industry forum that manages the MULTOS smart card platform, which is MasterCard’s preferred operating system for multi-application smart cards. MXI will also continue managing Mondex electronic cash and the Mondex Certification Authority and security infrastructure, in addition to providing ongoing support and services to the Mondex franchisees and licensees.
“As a founding shareholder of Mondex International, we are very pleased with this development,” said David J. Mills, general manager, HSBC Bank plc. “This agreement will streamline the governance and management of MXI’s products and services, providing greater flexibility to meet the needs of MXI franchise holders in the rapidly-evolving marketplace.”
“This acquisition is closely aligned with our strategy of giving MasterCard’s member financial institutions access to the best and most secure choices available in the marketplace and strengthens MasterCard’s overall position in smart card development by leveraging Mondex’s technological expertise under one roof,” said Chris Thom, senior executive vice president of MasterCard International. “In acquiring MXI,” he continued, “we are bringing into MasterCard the world’s most secure and flexible smart card operating system, a full-functioning certification authority, the Mondex offline e-cash program, and considerable technical expertise. Under MasterCard’s management, these assets will be fully available to help MasterCard’s members and Mondex franchise holders develop best-in-class smart card programs.”
MULTOS is the most robust, flexible and secure smart card platform in the market today. It is the only operating system for smart cards to have been certified with the prestigious ITSEC Level E6 security rating, the highest available. MULTOS is an open platform, which enables a number of different, independently functioning applications to reside on a single card simultaneously. To date, more than 6 million smart cards have been issued on the MULTOS platform, and more than 75 issuers are now committed to issuing 20 million additional MULTOS smart cards. More than 70 companies currently supply MULTOS-related products and services.
The Mondex Certification Authority, located in a highly secure facility, maintains best-in-class security and operations capabilities. It manages a well-established process for chip security and analysis. The authority handles issuance of certificates globally for the MULTOS “load and delete” mechanism, Mondex e-cash, and the MasterCard M/Chip(TM) family of payment applications. MasterCard is also evaluating offering the certification authority services to other industry participants requiring key management services.
Mondex Electronic Cash is the most complete and fully developed electronic cash proposition in the marketplace today and offers a number of unique benefits, including the only truly global and interoperable electronic cash product available today; multi-currency capability; the only card-to-card payment capability; offline transactions with immediate value transfer; and the highest security currently available. With virtually no per transaction cost, Mondex cash offers essentially zero marginal cost for the issuer. Mondex electronic cash has been franchised or licensed for use in 55 countries and territories around the world. There are approximately 30 Mondex implementations underway around the world, with additional activity expected over the coming year.
In addition to MasterCard International, current shareholders of Mondex International include 3328678 Canada Inc (“Mondex Canada”), Banco Internacional S.A., Bancomer S.A., Banco Nacional de Mexico S.A., Bank One Corporation, Banque Federative du Credit Mutuel S.A., Countrywide Banking Corporation, The Hong Kong and Shanghai Banking Corporation Limited, HSBC Bank plc., JCB Co. Ltd., J.P. Morgan Chase & Co., Mondex Australasia Pty Ltd., National Australia Bank Limited, National Westminster Bank plc., The Sanwa Bank Limited, Ulster Bank Limited, Wells Fargo & Company, and Universal Holdcorp Inc.
The proposed acquisition is expected to close at the end of this month.
About MasterCard International
MasterCard International is a leader in global e-business. The association is focused on providing its member financial institutions with customized, meaningful global e-business solutions that connect them to customers in both the online and offline worlds. Through its investment in industry innovation, participation in standards development and business alliances, MasterCard is staying in the forefront of technology integration to enable anytime, anywhere payments across multiple channels and various devices. MasterCard’s global e-business solutions include Internet interactive services, security, smart cards, mobile commerce/wireless, e-wallets, business to business electronic commerce, and numerous emerging technologies.
MasterCard International has the most comprehensive portfolio of payment brands in the world. More than 1.7 billion MasterCard(R), Cirrus(R) and Maestro(R) logos are present on credit, charge and debit cards in circulation today. An association comprised of more than 20,000 member financial institutions, MasterCard serves consumers and businesses, both large and small, in 210 countries and territories. MasterCard is the leader in quality and innovation, offering a wide range of payment solutions in the virtual and traditional worlds. MasterCard’s award-winning Priceless(R) advertising campaign is now seen in 81 countries and in more than 36 languages, giving the MasterCard brand reach and scope unrivaled by any competitor in the industry. With more than 21 million acceptance locations, no card is accepted in more places and by more merchants than the MasterCard Card. In 2000, gross dollar volume exceeded US$857 billion. MasterCard can be reached through its World Wide Web site at http//www.mastercard.com.Details