JP Morgan on Wednesday announced their plan to buy a majority stake, approximately around 75% in Volkswagen’s business. The U.S. banking giant said the deal might help expand its digital payment capabilities entering the automotive industry.
Moreover, the two companies plan to develop Volkswagen’s platform to target markets outside the automotive sector. According to a source from EMEA, they plan to build on Volkswagen Financial Services innovative groundwork on the current platform and apply the global scale of our payments expertise to meet evolving customer expectations in the auto space and beyond. The financial terms of the deal were not disclosed.
The company has been pushing the payment industry for a while now as the firm’s payments arm was established in Luxembourg in 2017. Its platform lets customers lease cars and pay for parking tickets, charging for EVs among others.
The news did create some buzz on Volkswagen’s share price, which had dropped down to 2% earlier this Wednesday amid a broad slump in EU markets.
The German automaker will come under the control of JP Morgan’s wholesale business, and the transaction is said to be finalized in the first half of 2022. He hinted that the two firms might be subject to change venture branding following the deal’s completion.