Mobile Banking Consolidation: Monitise Buys Clairmail For $173 Million

One more sign of the mobile money space continuing to grow up: some significant consolidation underway. Today, the UK-based mobile banking specialists Monitise announced that it is buying Clairmail, a U.S.-based competitor, for $173 million, as part of its global expansion.

The combined group says it will serve 13 million customers world-wide processing some $10 billion of payments weekly, and will give Monitise a much bigger and direct presence in the North American market: one-third of the top 50 U.S. financial institutions are now clients of the group.

Monitise and Clairmail both focus on an “infrastructure” play around mobile banking and mobile payments. Their main business is in providing the backend to let banks and other financial institutions offer mobile banking, payment and shopping services to its customers.

Alastair Lukies, Monitise Group CEO, tells me that Monitise is not actively looking for further acquisitions but that, “if opportunities come along, we will take them seriously.”

As mobile banking and mobile money services continue to mature (and see many new entrants enter the game, from PayPal to Square and so many more), it’s inevitable to see consolidation in the space to further the global reach of such services.

But Lukies says he believes that there is much more room for smaller companies and innovation at the “edges” of mobile payments systems — that is, those that touch consumers — than there is among the infrastructure players like Monitise, which are likely to continue scaling up.

He says that for now Monitise is not interested in acquiring those smaller companies: “We are not into the piloting and the bleeding edge stuff,” he says.

The link-up between Clairmail and Monitise will not only give the two companies a bigger geographical reach, but will also give customers of the companies access to providing banking services on a much wider international scale.

“This deal is transformational for our customers, our team, our shareholders and our company. It is a compelling combination and great news for all those wanting to offer bank-grade mobile money services to billions of consumers, not only in the US but worldwide,” commented Alastair Lukies, Monitise Group CEO, in a statement.

That is also furthered by Monitise’s existing strategic relationships with payments giants Visa Inc. and FIS. (Visa, of course, has been making other big investments into how it can best leverage the development of mobile money services, from partnerships with operators to acquisitions, such as its purchase of Fundamo last year.)

Pete Daffern, the CEO of Clairmail, will continue on as the head of Clairmail within the combined  company and will also join the group executive board.

Full statement below:

Clairmail to be Acquired by Monitise

Acquisition Unites Mobile Money Leaders to Power a New Generation of Global Financial Institutions and Consumers Through a Comprehensive Set of Mobile Banking, Payment and Commerce Solutions

SAN RAFAEL, CA–(Marketwire – Mar 26, 2012) – Clairmail, Inc., a leading North American mobile banking and payments provider, today announced that it has entered into a definitive acquisition agreement with Monitise plc (LSE: MONI.L), the technology and services company delivering mobile money networks worldwide. Monitise will acquire Clairmail for $173 million, pending regulatory and shareholder approvals.

Through the acquisition, Monitise will further enhance its position as the global leader in the fast expanding market for mobile money, spanning banking, payments and commerce.

The combined entity will encompass 13 million registered consumers across four continents. Clairmail and Monitise process billions of transactions a year and more than $10 billion of payments and transfers on a current weekly annualized basis.

On completion of the acquisition, the combined businesses will provide mobile money services to the widest possible range of financial institutions in the US. A third of the top 50 North American financial institutions (including 8 of the top 13) have chosen the companies’ services alongside hundreds of smaller and medium sized financial institutions customers.

“Clairmail is an undisputed mobile banking leader with a strong roster of financial institutions of all sizes, having been chosen by more than a third of the top 50 North American banks to provide innovative mobile solutions to their customers,” said Alastair Lukies, Monitise Group CEO. “Clairmail shares Monitise’s customer-centric approach and dedication to bringing the best possible mobile experience and technology through constant innovation and a focus on delivering bank-grade mobile services to their customers. This deal is transformational for our customers, our team, our shareholders and our company. It is a compelling combination and great news for all those wanting to offer bank-grade mobile money services to billions of consumers, not only in the US but worldwide.”

The acquisition further enhances Monitise’s mobile money reach into North America through Clairmail’s direct sales channel and deep relationships with leading financial institutions. For Clairmail, the acquisition brings the potential to expand the company’s award-winning mobile banking technology to new customers across new markets. The acquisition provides a step change in growth potential for Monitise through direct sales in the US driven by Clairmail’s mobile banking team and expertise. This, combined with Monitise’s existing and unmatched strategic partnerships with Visa Inc. and FIS, provides the enlarged group with a leading position in the US and three commanding routes to market.

New and current customers of both companies will benefit from the balanced deployment models of on-premise and hosted mobile banking, payments and commerce products, providing a variety of options in the deployment and customization process. The suite of Clairmail products will be maintained and enhanced with both companies enriching each other’s mobile offerings.

“This acquisition validates the vision behind both companies’ strategies in the exploding mobile money market where Monitise has established a clear global leadership position,” said Pete Daffern, Clairmail CEO. “Both companies have incredible synergy and are dedicated to offering bank-grade services that empower consumers to bank, pay and shop across any mobile device. I could not be more proud of the Clairmail team and its accomplishments since founding in 2004, and look forward to working with the seasoned team behind Monitise to continue innovating and pushing the boundaries of mobile banking, payments and commerce worldwide.”

Pete Daffern will remain in his role as Head of the Clairmail business and will also join the Group Executive Board of Monitise, bringing his substantial experience and expertise to bear across the Group growth strategy.