MasterCard To Pay $1.8 Billion Settlement In American Express Suit

New York, NY (AHN) - MasterCard Inc. (MA) said Wednesday it will pay American Express (AXP) $1.8 billion to settle an antitrust case. The agreement calls for 12 quarterly payments of $150 million, beginning in the third quarter.

The suit, filed by Amex in 2004, accused MasterCard of preventing it from participating in bank issued credit cards with MasterCard member banks.

"We are pleased to have reached a settlement with terms that will enable us to keep our strong balance sheet intact," said MasterCard President and Chief Executive Robert W. Selander, according to a MarketWatch report. He added that "eliminating the uncertainty" of a prolonged court case is in the best interests of shareholders.

MasterCard said they will take a charge in the current quarter for the charge.

Visa (V), also listed in the 2004 suit, settled with Amex in November for $2.25 billion.

American Express filed the suit after a U.S. Supreme Court upheld a lower court ruling that made Visa and MasterCard allow their member banks to issue credit cards with other providers.

Shares of MasterCard closed Wednesday trading 3 percent higher.