Fiserv has struck a deal to buy First Data for $22 billion, combining two companies that, though largely unknown to consumers, provide much of the financial technology that connects Wall Street to Main Street.
The all-stock deal underscores the growing threat of upstart financial-technology firms to a lucrative but obscure business long controlled by more mature companies. Fiserv and First Data provide a range of technology services to banks, merchants and other companies involved in the business of moving money. Chief among those services: payments. Fiserv processes credit- and debit-card transactions for banks, while First Data handles the merchant side of the equation. Square Inc. and other fintech firms have muscled into the market in recent years, luring away potential customers and threatening a major source of revenue.