Worldpay Stock Climbs On $43 Bln Deal To Merge With FIS

Shares of Worldpay, Inc. (WP, WPY.L) were gaining around 12 percent in London after the eCommerce and payments technology company announced its agreement to be merged with FIS (FIS), a U.S. financial services technology 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.

Under the deal terms, Worldpay shareholders will be entitled to receive 0.9287 FIS shares and $11 in cash for each share of Worldpay at the closing.

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.

FIS shareholders will own approximately 53 percent of the combined company, while Worldpay shareholders will own approximately 47 percent.

Worldpay, which provides solutions for merchants, businesses and financial institutions, processes over 40 billion transactions annually, supporting more than 300 payment types across more than 120 currencies.

The combined company is expected to be positioned to offer best-in-class enterprise banking, payments, capital markets, and global eCommerce capabilities.

The companies project organic revenue growth 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. The combination will result in $500 million of revenue synergies, $400 million of run-rate expense synergies and nearly $4.5 billion of free cash flow in three years.

Further, the combined company will have pro forma 2018 annual revenue and adjusted EBITDA of approximately $12.3 billion and $4.9 billion, respectively.

Upon closing, the combined company’s Board of Directors will consist of 12 members, seven of which will come from FIS’ Board and five from Worldpay’s Board.

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.

In London, Worldpay shares were trading at 8,279 pence, up 11.7 percent. In the pre-market activity on the NYSE, shares were gaining around 10.4 percent at $108.95.

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