FIS acquires Worldpay for $34bn
Banking technology giant FIS is acquiring payments firm Worldpay via a cash and stock combination – bringing Worldpay’s enterprise value to approximately $43 billion (including the assumption of Worldpay debt, which FIS expects to refinance).
According to Bloomberg, FIS is spending $34 billion on this purchase.
“Making decisions that achieve our growth and performance objectives,” says Worldpay CEO.
Under the terms of the agreement, Worldpay shareholders will be entitled to receive 0.9287 FIS shares and $11 in cash for each share of Worldpay. Upon closing, FIS shareholders will own approximately 53% and Worldpay shareholders will own approximately 47% of the combined company.
The firms say that this combination aims to expand and complement FIS’ acquiring and payment offerings, while increasing Worldpay’s distribution footprint.
“Scale matters in our rapidly changing industry,” states Gary Norcross, chairman, president and CEO, FIS. “Upon closing later this year, our two powerhouse organisations will combine forces to offer a customer-driven combination of scale, global presence and the industry’s broadest range of global financial solutions.”
“At Worldpay, our focus has always been on delivering more value to our clients and partners and making decisions that achieve our growth and performance objectives,” says Charles Drucker, executive chairman and chief executive officer, Worldpay.
Organic revenue growth outlook has grown from 6% to 9% through 2021 for FIS, in conjunction with $700 million of total EBITDA synergies from the combination of revenue and expense opportunities over the next three years.
This acquisition comes hot on the heels of another massive deal in the payments space: Fiserv, another US heavyweight and direct rival of FIS, buying First Data.
Worldpay, as it is today, is also the result of a big merger with Vantiv announced back in 2017.
The combined company of Worldpay and FIS will have pro forma 2018 annual revenue and adjusted EBITDA of approximately $12.3 billion and $4.9 billion, respectively.
Upon closing, the combined company’s Board of Directors will consist of 12 members, seven of which will come from FIS’ board of directors and five of which will come from Worldpay’s.
Gary Norcross will remain as FIS chairman of the board, president and chief executive officer. Charles Drucker, Worldpay’s current executive chairman and CEO, will serve as the executive vice-chairman of the board.
The transaction is subject to receipt of required regulatory and shareholder approvals and other customary closing conditions and is expected to close in the second half of 2019.
