BY Richard Summerfield
Global Payments Inc is to acquire rival Total System Services Inc (TSYS) for around $21.5bn in stock, the companies have announced.
The deal is Global Payment’s largest ever acquisition and the third ‘mega merger’ announced in the increasingly active payments industry this year. The all-stock deal values TSYS at $119.86 per share, an increase of 20 percent on the company’s stock price since before news of the talks between the companies began to emerge.
Once completed, the deal will see Global Payments shareholders own 52 percent of the combined company, while TSYS investors will own the remaining 48 percent. TSYS chief executive Troy Woods will become the combined company’s chairman. The company will have a total equity value of around $40bn.
“The combination of Global Payments and TSYS establishes the leading pure play payments technology company with unparalleled vertical market and payment software capabilities and ecommerce and omnichannel solutions, operating at scale in fast growing markets globally,” said Jeff Sloan, chief executive of Global Payments. “This transformative partnership accelerates our technology-enabled, software-driven payments strategy and provides exposure into attractive and complementary businesses, while enhancing our financial strength and flexibility.”
He continued: “We could not be more excited about the future as we bring together two industry leaders with strong businesses and cultures that will generate significant opportunities for our employees, customers, partners and shareholders worldwide.”
“In this exciting merger of equals, our new company will truly be a payments powerhouse that is perfectly poised to lead the industry in delivering merchant, issuer and consumer payments technology, solutions and service to our customers,” said Mr Woods, chairman, president and chief executive of TSYS. “Our companies share common values, a strong culture of putting people first, and a relentless commitment to doing the right thing, making this combination the perfect fit. The entire TSYS team is proud to link arms with Global Payments, and we look forward to leading the market as the preeminent payment solutions provider.”
Upon closing, Global Payments will process in excess of 50 billion transactions annually in 38 countries physically and over 100 countries virtually, employing over 3500 sales and sales support professionals worldwide.