Today we are watching…
1. Mastercard (#master)
The credit card deserves credit for surviving decades of fintech innovation to still be mainstream, but there’s no layup now. MasterCard’s acquisition of data aggregator, Finicity, means it will be able to process credit decisions much faster. This opens the floodgates for payment method innovation as no longer will cards need to communicate with banks and do so much work at the checkout. The acquisition will close this year, and although “immediately dilutive” to Finicity shareholders, it promises $126 million synergies. Visa is making moves, too. It bought Plaid last year to connect apps like Venmo to consumer data. Watch this space!
2. United Continental (#united)
United Airlines has (1) added thermometers to flight attendants’ uniforms, (2) cut a few routes across the pond, and (3) up-scaled an already massive debt sale. The new senior secured bonds are juicy, some say, because while dangling a big yield, bailouts are intended to keep the carrier alive and service that debt. It also wouldn’t be surprising to see United ‘hit the bid’ on the stock market’s next moment of frothiness, raising funds to put a cushion underneath the bonds, ensuring they can be paid. Is this an airline “too big to fail?”