Research Desk Line-up: Alliance Data Systems Post Earnings Coverage
LONDON, UK / ACCESSWIRE / October 23, 2017 / Pro-Trader Daily takes a look at the latest corporate events and news making the headlines for First Data Corp. (NYSE: FDC), following which we have published a free report that can be viewed by signing up at http://protraderdaily.com/optin/?symbol=FDC. The Company announced on October 20, 2017, that it has entered into a definitive stock purchase agreement to buy BluePay Holdings Inc. from its current owners, TA Associates and BluePay Management. For immediate access to our complimentary reports, including today's coverage, register for free now at:
Discover more of our free reports coverage from other companies within the Business Services industry. Pro-TD has currently selected Alliance Data Systems Corporation (NYSE: ADS) for due-diligence and potential coverage as the Company announced on October 19, 2017, its financial results for Q3 2017 which ended on September 30, 2017. Tune in to our site to register for a free membership, and be among the early birds that get our report on Alliance Data Systems when we publish it.
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- The total consideration for the transaction has been decided at $760 million in cash, subject to adjustments.
- In fact, First Data expects this transaction to be accretive to earnings in the first full year post-closing, before expected synergies.
Acquisition Would Provide Complimentary Solutions for Customers
BluePay delivers technology-enabled payment processing solutions for merchants in the US and Canada. It is among First Data's largest distribution partners with a strong focus on software-enabled payments and Card-Not-Present transactions. The Company processes annual volume of nearly $19 billion for over 77,000 merchants while it is also integrated into more than 450 software platforms. BluePay is an ideal match for First Data as it offers software integration solutions that complement those offered through First Data's Card Connect business.
Frank Bisignano, Chairman and Chief Executive Officer (CEO) at First Data, stated that BluePay is an established First Data distribution partner with an outstanding track record of innovation and growth. He shared that First Data is pleased to welcome BluePay's unique capabilities and its talented team to the First Data family.
BluePay's best-in-class integrated Card-Not-Present solutions, combined with CardConnect's cutting-edge ISV product suite acquired in the beginning of 2017, would provide First Data a competitive edge in the high growth integrated payments space.
- The acquisition would accelerate First Data's ISV strategy, mainly in the Card-Not-Present and ecommerce segments.
- BluePay's integrated solutions are complementary to First Data's recently acquired CardConnect ISV capabilities. Thus, BluePay would benefit from CardConnect's best-in-class merchant and partner management tools.
- The move would enhance First Data's ERP integrated payment offering, and add Member Based Organization solutions to First Data's product suite.
- Moreover, it would strengthen the overall product suite that First Data offers its JVs, acquiring partnerships, and other distribution channels.
- The move would have modest impact on leverage while the medium-term deleveraging objective remains intact.
Value Creation for BluePay Stakeholders
John Rante, Executive Chairman at BluePay, had an optimistic view about the move. He highlighted that this transaction represents a lucrative opportunity for BluePay to become a part of such an established global organization.
Moreover, Bala Janakiraman, CEO at BluePay, believes that joining hands with First Data can fast-track BluePay's software-driven payments strategy. More importantly, the combination of First Data's payment facilitation capabilities, global processing expertise, and an unparalleled distribution network would create considerable value for BluePay's clients as well as partners.
- As of now, the transaction is subject to customary closing conditions, such as the expiration of the applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976.
- The transaction is also subject to regulatory approvals and is expected to close in the fourth quarter of 2017.
Financial and Legal Advisors
For the purpose of this transaction, Weil, Gotshal & Manges LLP served as the legal advisor to First Data. On the other hand, Credit Suisse served as the financial advisor to BluePay, while Goodwin Procter acted as its legal advisor.
Last Close Stock Review
First Data's share price finished last Friday's trading session at $19.08, advancing 3.41%. A total volume of 9.95 million shares have exchanged hands, which was higher than the 3-month average volume of 5.70 million shares. The Company's stock price skyrocketed 1.54% in the last three months, 21.99% in the past six months, and 39.27% in the previous twelve months. Additionally, the stock soared 34.46% since the start of the year. Shares of the Company have a PE ratio of 32.56 and currently have a market cap of $17.03 billion.
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