Could Labry Move to Merchant Unit Presage a Breakup of First Data?
(January 6, 2006) With Ed Labry this week taking over First Data Corp.’s acquiring business, including First Data Merchant Services, some industry observers are figuring the Denver-based processing giant may be looking toward spinning off both the merchant division and the lucrative Western Union franchise as independent companies some time within the next 12 months. “It’s at least 50-50 and maybe better that the company will be broken up, based on what I’m hearing from Wall Street,” says Stamford, Conn.-based payments consultant Steve Mott, who follows First Data closely. Mott says installing Labry, a well-regarded payments executive, to run the merchant operation gives First Data a strong hand at the helm whether the company stays together or not. “Putting Labry in that business is the best hedging strategy [for First Data],” he says. Citing a quiet period prior to an earnings release, First Data refused to comment on Labry’s new role beyond a terse announcement released earlier this
