FIS - Fidelity National Information gains on report of Worldpay takeover interest
2023-07-03 08:06:05 ET
Fidelity National Information Services ( NYSE: FIS ) rose 7.1% in premarket trading on a report that buyout firms are exploring purchasing a majority stake in its Worldpay unit at a valuation of more than $15 billion.
Private equity firm Advent, which was previously part of the consortium that owned Worldpay, is evaluating making an offer, according to a Financial Times report on Friday, which cited people familiar with the matter. Chicago-based PE firm GTCR has also studied a bid.
The report comes after Fidelity National ( FIS ) announced in February that it planned to spin off its Merchant Solutions business , known as Worldpay. Fidelity National purchased Worldpay for about $35 billion in 2019.
A potential Worldpay sale "cleans up legacy FIS, reviving the story of a stable, high-margin, mid-single digit grower, reduces share-loss narrative overhand, de-levers, avoids assigning a spin-off multiple for Worldplay amid 1%-2% sales decline in 2023," Mizuho analyst Dan Dolev, who has a buy rating and $80 price target on FIS, wrote in a note on Monday.
Assuming a majority of the debt remains with FIS, it is likely $10 billion out of $18 billion in net debt, ~2$ dis-synergies, and negative corp. EBITA leaves FIS at 8x–9x EV/EBITDA, according to Dolev.
The payment technology company announced in December that it started a comprehensive review of its strategy, businesses, operations, and structure as part of a cooperation agreement with shareholder D.E. Shaw .
More on Fidelity National Information
- Fidelity National Information Services: A Fair Yield And A Fair Price
- Fidelity National Information Services: Why Does Seth Klarman Own 4.3% Of FIS?
- Jana Partners boosts stake in Fidelity National Information
- Fidelity National Information gains amid takeover speculation
- Fidelity National Information may fetch $85 to $105 a share in takeover
For further details see:
Fidelity National Information gains on report of Worldpay takeover interest