US company Fidelity National Information Services (FIS) is to acquire Worldpay in a $43bn (£32bn) deal. This is the second time Worldpay, which was spun out of Britain’s Royal Bank of Scotland as a condition of its bailout during the financial crisis, has been acquired.
WorldPay first started in 1989 as electronic payments system Streamline. It was owned by NatWest Bank, which was then acquired by RBS in 2002. Streamline was renamed as RBS WorldPay. RBS expanded the service to other countries, including the US and the Netherlands.
In 2009 the European Commission said that RBS would have to sell WorldPay and other businesses, as a condition of approving state aid to the bank. The next year, WorldPay was sold to private equity firms Advent International and Bain Capital for £2bn, with RBS retaining a 20% stake
Worldpay shareholders will receive 0.9287 FIS shares and $11 in cash under the terms of the offer. The bid values Worldpay’s shares at roughly $112, a premium of just over 13 per cent from its close last week.
“Scale matters in our rapidly changing industry,” said FIS’s Gary Norcross, who will remain chairman of the board of directors, president and chief executive. FIS said it will look to reap $700m of ebitda synergies from cost cutting and cross-selling over the next three years.
The deal will see Jacksonville-based FIS retain its headquarters and get to name seven directors to a 12 member board, while Worldpay will get the other five. Worldpay boss Charles Drucker will become executive vice-chairman.
FIS develops technology ranging from the core banking platforms that power retail lenders’ systems to software for asset managers. The company has grown through more than a dozen acquisitions in the last 15 years.
Worldpay specialises in services that enable merchants to take digital payments and processes some 40bn transactions annually in 146 countries and 126 currencies.
The New York and London listed group is based in Ohio after the Vantiv deal, though it retains an international base in the UK. FIS made no mention of the UK base in its announcement.