A legal dispute between JPMorgan Chase & Co. and the founder of Viva Wallet, a prominent Greek payments firm, appears to be reaching its conclusion following a recent ruling by a UK judge. The case centered around the valuation of Viva Wallet and claims of strategic suppression of its growth.
In 2022, JPMorgan acquired a 48.5% stake in Viva Wallet for approximately $800 million. The remaining majority, 51.49%, is held by Haris Karonis through his investment firm, Werealize.com. The conflict arose earlier this year when Karonis initiated legal proceedings against JPMorgan. He accused the Wall Street giant of employing tactics designed to stifle Viva Wallet’s growth and decrease its valuation. Karonis alleged that JPMorgan was deliberately blocking the firm’s expansion into the US and other European markets to devalue the company.
The core of the dispute lies in a clause tied to JPMorgan’s investment in Viva Wallet. If Viva Wallet’s valuation falls below €5 billion by June 2025, Werealize.com would lose its right to reject a takeover offer from JPMorgan. This clause heightened the stakes of the valuation disagreement, with Karonis fearing an undervalued takeover bid.
The London judge, while dismissing the claim that JPMorgan had a deliberate incentive to suppress Viva Wallet’s valuation, has outlined a framework for how the company should be valued. This ruling marks a significant step towards resolving the dispute and determining a fair valuation for Viva Wallet.
Karonis responded positively to the judgment, stating, “This ruling paves the way for a proper valuation of Viva Wallet. The ruling holds that Viva should be valued according to its full market potential, which includes its lucrative US expansion plans.” His statement underscores the importance of recognizing Viva Wallet’s growth potential in new markets as a critical factor in its valuation.
A spokesperson for JPMorgan also welcomed the judge’s decision, emphasizing the bank’s commitment to the growth and success of Viva Wallet. “With a financial stake in the company, we have repeatedly offered ways to help the company expand and succeed. The court has now provided a critical step to move forward with fair and transparent valuations – which could allow Viva to be sold soon, before the Fintech M&A market further softens,” the spokesperson said.
This ruling not only sets the stage for a fair valuation of Viva Wallet but also opens the possibility for a strategic sale before potential market downturns. As the fintech landscape continues to evolve, the outcome of this valuation process could have significant implications for both JPMorgan and Viva Wallet’s future.
The resolution of this dispute highlights the complexities involved in high-stakes investments in the fintech sector, where valuation disagreements can lead to protracted legal battles. However, with the judge’s intervention, both parties can now proceed with a clearer understanding of the path forward, potentially leading to a successful resolution that benefits all stakeholders involved.