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FIS and Worldpay to Combine to Accelerate the Future of Finance and Commerce Globally

Key facts

  • 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

  • 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 at 8:30 a.m. (EDT)

 

At the closing, under the terms of the agreement, Worldpay shareholders will be entitled to receive 0.9287 FIS shares and $11.00 in cash for each share of Worldpay. Upon closing, FIS shareholders will own approximately 53 percent and Worldpay shareholders will own approximately 47 percent of the combined company. The combination of stock and cash values Worldpay at an enterprise value of approximately $43 billion, including the assumption of Worldpay debt, which FIS expects to refinance.

FIS and Worldpay have complementary solutions and services encompassing financial institution issuer services, network and merchant services including global leadership in eCommerce, as well as loyalty and fraud solutions benefiting consumers and businesses. Clients will benefit from the combined omni-channel payment and multi-currency capabilities, robust risk and fraud solutions and advanced data analytics.

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 Worldpay, two companies that are leading their respective markets in modernization investments, provides clients of both organizations access to a wider portfolio of digital assets to accelerate their revenue growth, streamline their operations and create a better engagement with their customers.

“Scale matters in our rapidly changing industry,” stated Gary Norcross, chairman, president and chief executive officer, FIS. “Upon closing later this year, our two powerhouse organizations will combine forces to offer a customer-driven combination of scale, global presence and the industry’s broadest range of global financial solutions. As a combined organization, we will bring the most modern solutions targeted at the highest growth markets. The long-term value we will create for clients and for shareholders will set the bar in our industry and will create a range of new career opportunities for our employees. I have never been more excited about the future of FIS.”

As an industry leading global merchant acquirer, Worldpay is one of the world’s top payment technology companies powering global omni-commerce and providing solutions for merchants, businesses and financial institutions on a global basis. It processes over 40 billion transactions annually, supporting more than 300 payment types across more than 120 currencies.

“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 Charles Drucker, executive chairman and chief executive officer, Worldpay. “We are proud to become part of one of the financial services industry’s most respected and consistently performing companies, and I am excited about the new opportunities this brings both for the business and our colleagues worldwide.”

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. 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 combined company will retain the name FIS and will be headquartered in Jacksonville, Fla.

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.

Centerview Partners LLC and Goldman Sachs & Co. LLC acted as financial advisors to FIS. Willkie Farr & Gallagher LLP served as FIS’ legal advisor in the transaction. Credit Suisse acted as financial advisor to Worldpay. Skadden, Arps, Slate, Meagher & Flom LLP served as Worldpay’s legal advisor in the transaction.

Webcast

FIS will sponsor a live webcast about this announcement with the investment community beginning at 8:30 a.m. (EDT) Monday, March 18, 2019. To access the webcast, go to the Investor Relations section of FIS’ homepage, www.fisglobal.com. A replay will be available after the conclusion of the live webcast.

About FIS

FIS is a global leader in financial services technology, with a focus on retail and institutional banking, payments, asset and wealth management, risk and compliance, and outsourcing solutions. Through the depth and breadth of our solutions portfolio, global capabilities and domain expertise, FIS serves more than 20,000 clients in over 130 countries. Headquartered in Jacksonville, Fla., FIS employs more than 47,000 people worldwide and holds leadership positions in payment processing, financial software and banking solutions. Providing software, services and outsourcing of the technology that empowers the financial world, FIS is a Fortune 500 company and is a member of Standard & Poor’s 500® Index. For more information about FIS, visit https://www.fisglobal.com.

Follow FIS on Facebook (facebook.com/FIStoday), LinkedIn (linkedin.com/company/fis) and Twitter (@FISGlobal).

About Worldpay

Worldpay is a leading payments technology company with unique capability to power global omni-commerce. With an integrated technology platform, Worldpay offers a comprehensive suite of products and services, delivered globally through a single provider. Worldpay processes over 40 billion transactions annually, supporting more than 300 payment types across 146 countries and 126 currencies. Worldpay is focused on expanding into high-growth markets and customer segments, including global eCommerce, integrated payments and B2B. Visit us at https://www.worldpay.com.

 

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