Amex looking for deals in Silicon Valley

* Amex earmarks $100 mln for digital commerce investments

* Willing to use more of its balance sheet for deals

* To open Silicon Valley office run by Sanghi

By Alistair Barr

Nov 8 (Reuters) - American Express Co is looking for acquisitions and other deals in Silicon Valley to help the credit card giant expand more in digital commerce.

The New York-based company said on Tuesday that it plans to invest $100 million in early stage start-ups and other businesses in areas including loyalty and rewards, mobile and online payment management, security and fraud detection and data analysis.

"We're also looking at a number of different partners and acquisitions to move into new segments of the market, new geographies and new capabilities," said Dan Schulman, group president of American Express' Enterprise Growth Group. "We're willing to use more of our balance sheet."

Amex is setting up an office on Silicon Valley to help oversee this initiative.

Harshul Sanghi, the former head of Motorola's venture capital unit, will run the office and is looking to hire about 30 to 50 people over the next one to two years to track down deals and work with developers.

As commerce moves increasingly online and more people use mobile devices to buy and sell, Amex and rivals Visa Inc and MasterCard Inc are trying to adapt so they can handle a share of these transactions and take their cut.

The moves put these giants in closer competition with eBay Inc's PayPal unit, a leader in online payments.

In April, Visa bought a stake in Square, a mobile payments start-up run by Twitter co-founder Jack Dorsey.

That same month, Amex invested in Payfone, which authorizes and processes mobile payments. The credit card company also invested in e-commerce company Rearden Commerce in September.