Dubai: Emirates NBD PJSC, the UAE's biggest bank by assets, is in talks to sell a significant minority stake in Network International, the bank's card-processing unit, banking industry sources said yesterday.
Earlier in the day a Bloomberg report said the bank had hired a consultant to value Network International LLC.
When contacted by Gulf News, Emirates NBD spokesperson said the bank did not want to comment on the matter at this stage.
However, sources in Emirates NBD and the banking industry said the bank was looking out for an equity and technology partner to expand the business outside the UAE.
"Network International is a hugely successful subsidiary. While a part sale of equity can give a cash boost to the bank's balance sheet, a strategic tie-up with a strong partner will help its expansion plans," said a banker familiar with the ongoing talks who declined to be named.
Revenue up on last year
The business subsidiary contributed Dh104 million in revenue in the first quarter of 2010, up seven per cent from Dh97 million during the same period last year.
While its (card) acquiring revenues grew 14 per cent, the card processing income grew nine per cent in the quarter, the bank said in its recently published first quarter results.
The company reported a profit of Dh199.3 million in 2009 after reporting a 13 per cent rise in revenue to Dh424.8 million.
Established in 1994, Network International LLC is one of the leading card payment services providers in the Gulf.
It serves 49 banks and financial institutions and more than 10,000 businesses, according to Emirates NBD's annual report.
The company is a Principal Member of Visa International and MasterCard International offering customers products and services in both the issuing and acquiring segment of the card industry, in the Gulf and Middle East.
It has also established merchant acquiring, processing partnership with third party customers such as American Express, Diners Club, JCB and eCompany for E-commerce merchant services.
In addition, Network also provides consultancy services ranging from planning and designing to the developing of new products and services and providing sponsorship with Visa and MasterCard International.
As a Merchant acquirer in the UAE, Network International describes itself as enjoying more than 65 per cent of the market share.