First Data processes $2.2 trillion worth of card, online and e-commerce payments a year on behalf of businesses. Its takeover of CardConnect will add another $26 billion of volume a year from 67,000 merchants.

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First Data processes $2.2 trillion worth of card, online and e-commerce payments a year on behalf of businesses. Its takeover of CardConnect will add another $26 billion of volume a year from 67,000 merchants.

First Data is to buy fellow payment processor CardConnect for $750 million in cash. The $15 a share deal announced yesterday is due to close in the third quarter of this year and includes the repayment of debt.

First Data is one of the world’s biggest card payment and e-commerce processors. It handles $2.2 trillion worth of transactions a year on behalf of businesses such as retailers, banks and others that need to process a payment.

The Atlanta, Georgia, U.S. headquartered company has revenue sharing alliances with Citi and SunTrust Merchant Services and stakes in Bank of America and Wells Fargo’s Merchant Services. The greater volume that a platform can attract the cheaper it is to process card and other payments, as economies-of-scale savings apply to aggregated flows.

The deal with CardConnect will give it an extra $26 billion worth of payments a year from 67,000 merchant customers and improve its financial technology (fintech) capabilities. The Pennsylvania-based business is known for its integrated payment solutions that link to corporate’s internal enterprise resource planning (ERP) systems. This could open up a new market for First Data and improve its cash management and other services to clients.

CardConnect recorded sales of $589 million last year, but lost nearly $16 million.

Commenting on the deal in a statement First Data’s chairman and CEO, Frank Bisignano, said the merged entity would be able to better serve partners and customers. He added that: “This transaction is consistent with our strategy of integrating and scaling innovative technologies across our distribution footprint.”

CardConnect was already a distribution partner for First Data, so the takeover formalizes its status. It went public last year after it was acquired by the FinTech Acquisition Corporation.

FT Partners advised CardConnect on the deal. Investment bank Allen & Company and the law firm Weil, Gotshal & Manges advised First Data.

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