FIS and Worldpay to Combine to Accelerate the Future of Finance and Commerce Globally
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The combined company will have approximately
$12.3 billion pro forma 2018 annual revenue - Accelerates FIS’ organic revenue growth outlook to 6 percent to 9 percent through 2021
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Anticipates
$500 million of revenue synergies,$400 million of run-rate expense synergies and nearly$4.5 billion of free cash flow in three years; driving significant value for our shareholders - Best-in-class capabilities serving high-growth eCommerce industry
- Combines a global leader in modern financial institutions solutions with a global leader in eCommerce and payments innovation
Gary Norcross to remain chairman of the board of directors, president and CEO;Charles Drucker to become executive vice chairman of the board of directors-
Companies to host joint announcement call
March 18, 2019 at8:30 a.m. (EDT)
At the closing, under the terms of the agreement,
FIS and
Organizations of all types and sizes are looking for new ways to create
more meaningful and frictionless experiences and grow their share of
wallet through digital channels. The combination of FIS and
“Scale matters in our rapidly changing industry,” stated
As an industry leading global merchant acquirer,
“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. Combining with FIS helps us accelerate the
achievement of that, now benefitting from new scale and capabilities
that will truly differentiate the company globally,” said
Strategic and Financial Rationale
- Global Growth Leader at Scale
The combination of industry leading technology platforms and global distribution channels serving high-growth secular markets will immediately accelerate the revenue growth profile of FIS and offer a best-in-class solution suite to our clients. Additionally, the combination will create meaningful revenue growth opportunities across the merchant and banking ecosystems.
- Significant Value Creation
Organic revenue growth outlook of 6 percent to 9 percent through 2021, in conjunction with$700 million of total EBITDA synergies from the combination of revenue and expense opportunities over the next three years.
- Enhanced Financial Profile
The combined company will have pro forma 2018 annual revenue and adjusted EBITDA of approximately$12.3 billion and$4.9 billion , respectively. FIS anticipates retaining its investment grade credit ratings of Baa2 / BBB, reducing leverage to approximately 2.7x in 12 to 18 months and continuing to grow its dividend supported by robust free cash flow.
- Experienced Management Team
Both management teams have a proven track record of innovation leadership, superior integration, and exceeding synergy plan targets to drive transformational value to clients and shareholders. This combination leverages expertise within the banking and payment industry.
Governance and Timing
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 Board of Directors.
The combined company will retain the name FIS and will be headquartered
in
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.
Webcast
FIS will sponsor a live webcast about this announcement with the
investment community beginning at
FIS is a global leader in financial services technology, providing
solutions and services to clients in the retail and institutional
banking, payments, capital markets, asset management and wealth and
retirement markets. Through the depth and breadth of our solutions
portfolio, global capabilities and domain expertise, FIS serves clients
in over 130 countries. Headquartered in
Follow FIS on
Statement Regarding Forward-Looking Information
The statements contained in this communication that are not purely historical are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, or “Securities Act” and Section 21E of the Securities Exchange Act of 1934, as amended, or “Exchange Act,” including statements regarding our expectations, hopes, intentions, or strategies regarding the future. These statements relate to, among other things, business and market conditions, outlook and our future financial and operating results and debt. In many cases, you can identify forward-looking statements by terminology such as “may,” “will,” “should,” “expect,” “plan,” “anticipate,” “believe,” “estimate,” “predict,” “potential,” or “continue,” or the negative of these terms, and other comparable terminology. Actual results could differ materially from those anticipated in these statements as a result of a number of factors, including, but not limited to:
- the risk that the transaction described herein will not be completed or will not provide the expected benefits, or that we will not be able to achieve the cost or revenue synergies anticipated;
-
the risk that the integration of FIS and
Worldpay will be more difficult, time-consuming or expensive than anticipated; - the risk of customer loss or other business disruption in connection with the transaction, or of the loss of key employees;
- the possible occurrence of an event, change or other circumstance that would give rise to the termination of the merger agreement;
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the fact that unforeseen liabilities of FIS or
Worldpay may exist; - the risk of doing business internationally;
-
changes in general economic, business and political conditions,
including the possibility of intensified international hostilities,
acts of terrorism, changes in either or both
the United States and international lending, capital and financial markets and currency fluctuations; - the effect of legislative initiatives or proposals, statutory changes, governmental or other applicable regulations and/or changes in industry requirements, including privacy and cybersecurity laws and regulations;
- the risks of reduction in revenue from the elimination of existing and potential customers due to consolidation in, or new laws or regulations affecting, the banking, retail and financial services industries or due to financial failures or other setbacks suffered by firms in those industries;
-
changes in the growth rates of the markets for the solutions of FIS
and
Worldpay ; - failures to adapt such solutions to changes in technology or in the marketplace;
- internal or external security breaches of systems, including those relating to unauthorized access, theft, corruption or loss of personal information and computer viruses and other malware affecting our software or platforms, and the reactions of customers, card associations, government regulators and others to any such events;
- the risk that implementation of software (including software updates) for customers or at customer locations or employee error in monitoring software and platforms may result in the corruption or loss of data or customer information, interruption of business operations, outages, exposure to liability claims or loss of customers;
- the reaction of current and potential customers to communications from us or regulators regarding information security, risk management, internal audit or other matters;
- competitive pressures on pricing related to the decreasing number of community banks in the U.S., the development of new disruptive technologies competing with one or more of our solutions, increasing presence of international competitors in the U.S. market and the entry into the market by global banks and global companies with respect to certain competitive solutions, each of which may have the impact of unbundling individual solutions from a comprehensive suite of solutions we provide to many of our customers;
- the failure to innovate in order to keep up with new emerging technologies, which could impact the merged companies’ solutions and ability to attract new, or retain existing, customers;
-
the failure to meet financial goals to grow business in
Brazil after the unwinding of FIS’ Brazilian Venture; -
the risks of reduction in revenue from the loss of existing and/or
potential customers in
Brazil after the unwinding of FIS’ Brazilian Venture; - an operational or natural disaster at one of our major operations centers; and
-
other risks detailed elsewhere in the two companies’ annual reports on
Form 10-K for the year ended
December 31, 2018 and in our and their other filings with theSecurities and Exchange Commission .
Other unknown or unpredictable factors also could have a material
adverse effect on our business, financial condition, results of
operations and prospects. Accordingly, readers should not place undue
reliance on these forward-looking statements. These forward-looking
statements are inherently subject to uncertainties, risks and changes in
circumstances that are difficult to predict. Except as required by
applicable law or regulation, neither FIS nor
Additional Information and Where to Find It
This communication is being made in respect of the proposed merger
transaction between FIS and
A free copy of the joint proxy statement/prospectus, as well as other
filings containing information about FIS and
Participants in the Solicitation
FIS and
This communication does not constitute an offer to sell or the solicitation of an offer to buy any securities or a solicitation of any vote or approval, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of such jurisdiction. No offering of securities shall be made except by means of a prospectus meeting the requirements of Section 10 of the Securities Act of 1933, as amended.
View source version on businesswire.com: https://www.businesswire.com/news/home/20190318005222/en/
Source:
Ellyn Raftery, 904.438.6083
Chief Marketing and Strategy Officer
FIS
Marketing and Communications
ellyn.raftery@fisglobal.com
Andrew
Ciafardini, 513.900.5308
Head of Global Corporate Communications
Worldpay
Corporate Communications
Andrew.Ciafardini@worldpay.com
Peter
Gunnlaugsson, 904.438.6603
Senior Vice President
FIS Investor
Relations
pete.gunnlaugsson@fisglobal.com
Nathan
Rozof, CFA, 866.254.4811
Head of Investor Relations
Worldpay
Investor Relations
IR@worldpay.com