American Express to Buy AOL Co-founder's Revolution Money

Authored by Mark Hefflinger on November 18, 2009 - 11:00am.

St. Petersburg, Fla. - Credit card giant American Express said on Wednesday that it will pay approximately $300 million to acquire Revolution Money, the Florida-based online payments company launched in 2007 by AOL co-founder Steve Case.

The company -- originally called GratisCard -- operates as a unit of Case's investment firm, Revolution, providing secure payments through an Internet-based platform.

No names or account numbers appear on Revolution's cards, and transactions are authorized by using a PIN number.

The company, a competitor to PayPal, also operates an online payments service that lets users exchange money for free.

"New payments products and platforms are evolving rapidly and it's important for us to keep identifying cutting edge technologies that can extend our leadership beyond the traditional payments arena," said Kenneth Chenault, the chairman and CEO of American Express.

"While Revolution Money is a young and relatively small company, we believe it has big potential."

Jason Hogg, the CEO of Revolution Money, will continue as president and CEO, with Chairman Ted Leonsis, a major shareholder, becoming a special advisor to American Express, focusing on digital and online payments strategy.

The deal is expected to close in early 2010, with the company -- which in April landed $42 million in its third round of funding -- operating as a unit of American Express.

Related Links:
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http://www.revolutionmoney.com