Visa Inc’s proposed takeover of former subsidiary Visa Europe, worth up to €21.2 billion, will better enable the merged entity to take advantage of Europe’s forthcoming mobile payments boom, said the card giant.

The agreement between the two firms to create a single global entity means Visa Europe can access Visa Inc’s mobile payments expertise, including work on wallets and tokenisation.

In Europe an estimated 37 per cent, or US$3.3 trillion, of personal consumption expenditure is still done via cash and cheques, said Visa’s announcement of the purchase. The announcement also points out Europe has strong availability of NFC (although not a strong take-up as yet).

“Visa Inc. has aggressively launched new mobile payment partnerships, platforms and products that will enable faster growth and adoption of mobile payments in Europe,” it claims.

These offerings include tokenisation, support for digital wallets and wearables, as well as strategic investments in other enabling technology, e-commerce and P2P payments. It has also opened several innovation centres around the world.

The takeover of Visa Europe consists of an upfront consideration of €16.5 billion with the potential for an additional earn-out of up to €4.7 billion that is payable following the fourth anniversary of the deal closing.  Visa Europe is owned by a co-operation of European banks.