NetSpend Delays Shareholder Meeting to Consider Alternative Acquisition Proposals (May 30, 2013)
May 30, 2013
NetSpend Holdings Inc. this week said it will postpone a special shareholder meeting originally planned to finalize its proposed $1.4 billion merger with Total Systems Services Inc. (TSYS) from May 31 to June 18 to allow time to consider other unsolicited proposals and announce certain modifications to its TSYS agreement. Austin, Texas-based NetSpend also said it has entered a Memorandum of Understanding outlining terms to settle a shareholder suit opposing the merger with TSYS. A shareholder in February launched a class action in Delaware aimed at halting the deal, claiming the $16-per-share deal was “inadequate.” A Delaware Chancery judge on May 21 denied the attempt to block the sale, ruling that investors failed to prove they could nix the deal at trial.
NetSpend this week also announced modifications to its merger agreement. They include reducing the termination fee NetSpend must pay to TSYS to $44.0 million from $52.6 million and reducing the matching period for notice to TSYS before NetSpend may enter into a superior proposal to three business days from five.
TSYS on Feb. 19 announced plans to acquire NetSpend for $1.4 billion in cash. The deal was the latest in a string of announced mergers, including U.S. Bank’s acquisition last year of processor and program manager FSV Payment Systems. GPR distributor AccountNow in December also finalized its purchase of nFinanSe Inc.
