List of Mergers and Acquisitions

American Categorical has seen robust tailwinds, because of a wholesome world economic system. It is most likely greatest identified by customers for its credit score and cost playing cards. As such, it is nearly at all times in comparison with rivals Visa and MasterCard. Not like these two opponents, American Categorical is each the fee processor and issuer of its bank cards. Whereas this might open up larger earnings if members spend extra, it additionally exposes American Categorical to extra vital dangers if the economic system turns bitter.

The corporate has been formed by a sequence of mergers and acquisitions which have resulted in a few of its most profitable subsidiaries. This brief article outlines a few of the key information in regards to the firm in addition to a few of the firm’s most necessary subsidiaries that assist form it into what it’s immediately.

American Categorical: An Overview

• Based: 1850
• Headquarters: New York Metropolis
• Market Capitalization (as of Dec. 29, 2021): $126.9 billion

American Categorical (AXP) is an American monetary and journey companies company with operations in additional than 110 international locations. Its major merchandise embrace cost playing cards, bank cards, monetary companies, and travel-related companies like traveler’s checks. The corporate, generally known as Amex, markets these merchandise to customers, enterprise homeowners, and companies throughout the globe.

Based in 1850, the corporate is the world’s largest fee card firm by buy quantity with greater than $870 billion in complete world spending billed with greater than 68 million playing cards in circulation, as of Dec. 31, 2020. The corporate reported web earnings of $3.1 billion on income of $36.1 billion for the 2020 fiscal yr.

The corporate’s govt group is made up of:

• Stephen Squeri, chair and chief govt officer (CEO)
• Jeffrey Campbell, chief monetary officer (CFO)
• Marc Gordon, govt vice chairman and chief data officer (CIO)
• Monique R. Herena, chief colleague expertise officer
• Rick Petrino, chief working officer
• Elizabeth Rutledge, chief advertising and marketing officer
• Laureen E. Seeger, chief authorized officer
• Jennifer Skyler, chief company officer
• Anre Williams, chief govt officer

Amex’s Acquisition Technique

The primary technique behind American Categorical acquisitions is to reinforce its companies for present card members to facilitate the benefit of use of its merchandise. It additionally goals to encourage folks to make use of their playing cards extra often.

American Categorical bought U.Okay. fin-tech startup Cake Applied sciences in March 2018 for simply over $13 million. Cake supplies a service permitting restaurant-goers to pay a invoice extra simply. American Categorical indicated its plans to combine Cake applied sciences into its platform to supply members with an enhanced service. American Categorical will doubtless proceed to amass further firms as a way to additional lengthen its attain as a monetary companies megacompany.

As a significant monetary companies firm, American Categorical makes frequent acquisitions of smaller companies, lots of that are built-in into its broad platform of services and products. In January 2019, American Categorical introduced its intent to amass Pocket Concierge, a restaurant reservation platform focusing on companies in Japan for an undisclosed quantity.

American Categorical owns dozens of subsidiary firms, most of that are organized to hold out its enterprise operations in international international locations. Its most necessary subsidiaries embrace two card-issuing banks and a number of other monetary companies corporations primarily based in the USA.

American Categorical TRS

American Categorical Journey Associated Companies Firm, or TRS, is the corporate’s principal working subsidiary and operates within the specialty finance sector. As such, it’s the rapid mum or dad of each of the corporate’s card-issuing banks. TRS is handled as a monetary holding firm, which means that the Federal Reserve has jurisdiction to oversee and study its practices.

Whereas TRS contributes to American Categorical’s enterprise ventures in quite a lot of methods, the corporate is primarily liable for offering personnel, services, techniques, and different operational assets to varied American Categorical branches and subsidiary firms. In consequence, TRS is the direct or oblique proprietor of most of American Categorical’s authorized entities.

The first income for TRS is American Categorical’s low cost income or the quantity earned on transactions with retailers holding card acceptance agreements used to facilitate transactions with cardholders of American Categorical bank cards. TRS additionally earns income by way of card charges, journey commissions, and extra.

American Categorical Financial institution

American Categorical Financial institution (FSB) is a federal financial savings financial institution headquartered in Salt Lake Metropolis, Utah, and is a wholly-owned subsidiary of American Categorical. The financial institution points cost playing cards and bank cards for small companies underneath the American Categorical Open model. American Categorical Open playing cards and related companies are focused at corporations with as much as $10 million in annual income and fewer than 100 staff.

On the buyer aspect, American Categorical Financial institution points quite a lot of cost playing cards and bank cards underneath the American Categorical model, together with co-branded playing cards with American Categorical companions.

American Categorical Financial institution additionally affords financial savings accounts and certificates of deposit (CDs) to customers throughout the nation underneath the American Categorical Private Financial savings model. Accounts are solely out there on-line—the financial institution doesn’t function any retail areas. American Categorical Financial institution additionally accepts deposits by way of third-party brokerage companions.

American Categorical Centurion Financial institution

American Categorical Centurion Financial institution is the second main insured depository establishment for American Categorical. The Utah-chartered industrial financial institution can be headquartered in Salt Lake Metropolis.

Centurion Financial institution points quite a lot of shopper cost playing cards and bank cards underneath the American Categorical model. American Categorical Centurion Financial institution additionally accepts deposits by way of third-party brokerage companions. The financial institution doesn’t function any retail areas and is wholly owned by American Categorical.

Accertify

Accertify is a world fraud prevention firm with places of work in Illinois, Mexico, the UK, and Australia. The agency affords a variety of applied sciences and instruments used to stop on-line fee fraud. They’re additionally used to handle the threat related to card-not-present transactions. Its clients embrace e-commerce firms throughout the globe, together with the likes of StubHub, Inc., JetBlue Airways (JBLU), 1-800-Flowers.com (FLWS) and City Outfitters (URBN). Accertify is a subsidiary of American Categorical Journey Associated Companies Firm.

Accertify’s merchandise are suitable with fee networks used to make on-line purchases world wide, together with all main bank cards and on-line fee suppliers resembling PayPal (PYPL). The corporate affords fraud administration, chargeback administration, information evaluation, and fee gateway merchandise that may be mixed to supply fee options delivered through a hosted software-as-a-service (SaaS) platform. Accertify additionally affords managed service choices underneath which e-commerce retailers can outsource the fraud administration course of to Accertify’s employees of analysts. Based in 2007, Accertify was bought by American Categorical in 2010 for roughly $150 million and is now a wholly-owned subsidiary.

AMEX Assurance Firm

AMEX Assurance Firm acts because the insurance coverage underwriter for journey insurance coverage and different insurance coverage merchandise marketed and offered by American Categorical firms. It additionally underwrites sure insurance coverage advantages supplied to American Categorical cost card and bank card holders together with automotive rental loss and harm safety, prolonged guarantee safety, product buy safety, and journey accident insurance coverage. The corporate doesn’t have any retail operations. This firm was based in 1973 because the American Car Insurance coverage Firm of Illinois however modified its identify in 1986. Since September of 2007, it has operated as a subsidiary of American Categorical.