The U.S. Department of Justice is filing an antitrust lawsuit to block Visa's acquisition of financial technology firm Plaid.
The $5.3 billion planned acquisition, which was announced in January, is the subject of an antitrust complaint filed last week in federal court in San Francisco. DOJ officials said that the deal for Plaid would illegally extend Visa’s dominant position and should be halted.
“By acquiring Plaid, Visa would eliminate a nascent competitive threat that would likely result in substantial savings and more innovative online debit services for merchants and consumers,” the Justice Department said in the complaint.
The complaint references a description of the deal by Visa CEO Al Kelly, who called it an “insurance policy” to neutralize a “threat to our important U.S. debit business.”
“Visa strongly disagrees with the Department of Justice (DOJ), whose attempt to block Visa’s acquisition of Plaid is legally flawed and contradicted by the facts,” said company officials in a statement. “This action reflects a lack of understanding of Plaid’s business and the highly competitive payments landscape in which Visa operates.”
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