U.S. Bancorp said Tuesday it was selling the third-party debit-card operations of its Elan Financial Services unit to Fiserv Inc. for $690 million.
The business provides debit-card services, including operating and servicing more than 1,800 automated teller machines as well as networks that connect them, to other banks and credit unions. It generates about $170 million in annual revenue.
The deal includes Elan's ATM managed services and access to the surcharge-free MoneyPass network. It does not involve the ATM operations of U.S. Bank, the fifth-largest bank by assets in the country and largest by deposits in Minnesota.
"Our customers will benefit from the commitment that Fiserv has for this business, and U.S. Bank will benefit as we continue to reinvest in our core businesses," Tim Welsh, head of U.S. Bank's consumer banking sales and support business, said in a statement.
Minneapolis-based U.S. Bank, which has annual revenue of about $22 billion, said it will continue to provide other services through Elan, including issuing credit cards and providing corporate and merchant payment services.
Milwaukee-based Fiserv said it will use the Elan debit-card business to expand its electronic funds transaction services to banks and other financial firms. "This acquisition expands our capabilities and provides additional expertise," Jeffery Yabuki, Fiserv's chief executive, said in a statement.
Fiserv said it has other businesses, such as risk management solutions and another debit payments network called Accel, that customers of the Elan debit services will be able to access.
Fiserv, which has about $6 billion in annual revenue, said it expects the deal to add to its bottom line starting next year. The deal is expected to close in the fourth quarter.
