Fiserv Inc. is adding more muscle to its payments-processing business, particularly with respect to integrated payments and relationships with independent software vendors. The big financial-services technology company announced Thursday afternoon it has agreed to acquire Pineapple Payments, a 5-year-old payments processor, for undisclosed terms. The deal is expected to close by the end of June.
Pineapple is no stranger to Fiserv, as the company has been providing processing services for Pineapple merchants. “With Pineapple Payments already operating as a key distribution partner of Fiserv, we expect to accelerate the delivery of new and innovative capabilities to a host of new merchant clients,” said Frank Bisignano, president and chief executive of Fiserv, in a statement.
The deal follows Fiserv’s 2019 acquisition of the massive processor First Data Corp., of which Bisignano was chief executive, and marks the Brookfield, Wis.-based company’s further expansion into processing for card acceptance as well as support for ISVs, the entities that tie payments acceptance into management software for specific industries.
“Pineapple Payments’ mission is to add value to the payments experience through simple, secure, and scalable solutions.” said Brian Shanahan, Pineapple’s founder and chief executive, in the release announcing the deal. “Based on our existing relationship, we believe Fiserv is the ideal partner to take that mission to the next level and beyond.”
Observers note the importance of Pineapple’s ISV relationships, particularly as they can boost merchant retention through the integration of payments in the software sellers use to manage their business. “I’m sure it was a pretty healthy premium,” notes Jared Drieling regarding the undisclosed price Fiserv paid. Drieling is senior director of market intelligence and insights at The Strawhecker Group, an Omaha-based payments research and consulting firm. Fiserv will benefit, he adds, by “getting those ISV-boarded merchants. It all centers around integrated payments.”
Pittsburgh-based Pineapple may be relatively young but it has itself been acquisitive during its brief history. Its most recent deal, announced in January, was for 1st Payment Systems , a processor for ISVs specializing in power sports and health care.
Earlier, Pineapple agreed to buy a merchant portfolio from payments provider CardChamp (June 2019) and then acquired two other processors, Transax (August 2018) and Payline Data (October 2017). Terms were also not disclosed for these transactions.
Shanahan and his brother Jeff in 2006 founded a prior payments company, CardConnect, which became part of First Data in July 2017. The prior year, CardConnect had gone public through a merger with a special purpose acquisition company in an early example of the SPAC trend that has more recently caught fire in a variety of industries, including payments.
Brian Shanahan left CardConnect in 2014 and founded Pineapple Payments two years later. Jeff remained with the company after the First Data acquisition, leaving in 2018.