Mastercard Targets Middle East and Africa with This Move

On March 6, 2018, Mastercard (MA) announced the acquisition of Oltio in order to streamline its payment process in the Middle East and Africa. Mastercard plans to utilize Oltio’s capabilities to expand its digital tools in emerging markets as well as other markets that still rely mostly on cash transactions.

According to Mastercard’s top management, most transactions in the Middle East and Africa region are still made via cash. Mastercard believes this acquisition can help remove some of the hurdles in the way of digital payments.

Consumers want payment processes to be fast, easy, and safe. Payment through smartphones continues to see strong momentum, which could positively impact payments technology companies. The Oltio acquisition could help Mastercard improve its omni-channel solutions.

Mastercard’s price-to-sales ratio stood at 15.36x on an LTM (last-12-month) basis, and peers (XLF) Total System Services (TSS), Fitbit (FIT), and First Data (FDC) have ratios of 3.32x, 0.77x, and 1.28x, respectively, on an LTM basis.