Visa 2009 Annual Report Download - page 36
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Table of Contents
Share Repurchase Plan
In October 2009 our board of directors authorized a $1.0 billion share repurchase plan. The authorization will be in place through September 30, 2010,
and is subject to extension or expansion at the determination of our board of directors. See the Liquidity and Capital Resources section for further discussion.
Sale of Investment in Companhia Brasileira de Meois de Pagamento ("VisaNet do Brasil")
In June 2009, Visa International Service Association, a wholly-owned subsidiary of the Company sold its 10% ownership interest in VisaNet do Brasil
in connection with its initial public offering. As a result of this transaction, we received approximately $1 billion in net proceeds and recognized a pre-tax gain
of $473 million in investment income, net on our statement of operations. The amount of the gain net of tax was $237 million. Following their initial public
offering, we amended an existing agreement with VisaNet do Brasil which grants a license to use Visa trademarks and technology intellectual property. We
expect the license fees to be earned during fiscal 2010 to offset the loss of dividend income as a result of the sale of our ownership interest.
Expansion of Our Processing Capabilities
Expanding our processing capabilities worldwide is a core component of our long-term growth strategy. As part of this strategy, we created Visa
Processing Services Pte. Ltd. ("VPS"), a joint venture with Yalamanchili International Pte. Ltd. ("Yalamanchili"). We hold a 70% interest in VPS.
Yalamanchili is a payments processor and software company with operations in Asia. VPS will allow us to extend our industry-leading processing capabilities
in geographies where electronic payments are growing rapidly, providing multi-currency and multi-language debit, credit and prepaid processing services to
financial institutions, processors and payment companies. VPS will also have capabilities to provide ATM, money transfer and private label processing, as
well as a range of payments services, including risk and fraud management, mobile applications, loyalty and cardholder support. VPS provides prepaid and
debit processing solutions and complements our Debit Processing Service.
Nominal Payments Volume and Transaction Counts
We believe that payments volume and processed transactions are key drivers of our business. Payments volume is the basis for service revenues and
processed transactions are the basis for data processing revenues. As anticipated, for fiscal 2009 as compared to fiscal 2008, nominal payments volume
declined in credit and commercial products, which was offset by growth in debit resulting in minimal year over year nominal payments volume impact.
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