Safeway shares up 6 percent after Blackhawk IPO announcement

Safeway, one of the largest grocery store chains in the US, had an ascend in its shares on Wednesday after announcing the probable initial public offering of online payment, gift card and credit card unit Blackhawk.

The shares rose 6 percent to a little above $16 at midday after the company reported that it will undertake the Blackhawk IPO in the first six months of 2013, depending on the economic conditions in the region.

Though Safeway has a denser presence in the US, its different business units including Blackhawk are spread all over the world. Blackhawk is the company’s proprietary electronic payment system that offers prepaid gift card, prepaid credit cards and prepaid debit cards all over its chain of stores. All the more, it also has a proprietary payment system working under Blackhawk that connects 500 content providers and over 70,000 retail locations worldwide.

It also works with other vendors and companies through their kiosks such as DVDPlay, CoinMaster and various ATMs and in-store banks.

Blackhawk is one of the biggest profits generating business unit at Safeway and it is only mandatory to bring it to public via an IPO. The public offering will probably will fall somewhere in the Summers.

Safeway is furthering its efforts in the ease of payment through Blackhawk by introducing a new in-house payment system. The Automated Clearing House payment system is the making and once up and running will be installed at all Safeway stores in the first phase. Other affiliated businesses will follow afterwards.

The electronic payment system is gradually taking root in big store chains and technology companies. Since near-field communications (NFC) technology has shown a ubiquitous presence in smartphones and tablets technology companies like Google, eBay and Apple are working on electronic wallets for immediate payment systems.

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Posted by Usman Khalid on Sep 6 2012. Filed under Sci-Tech. You can follow any responses to this entry through the RSS 2.0. You can skip to the end and leave a response. Pinging is currently not allowed.