Vantiv Offers Deal for Worldpay Valued at $10 Billion

FTSE 100 falls but Worldpay (LON:WPG) jumps
Worldpay shares jump following confirmation of JPMorgan and Vantiv bids
Author

06 July, 2017

Payments company Worldpay shares soared 27.7 per cent to a record high after it received rival takeover approaches from credit card tech firm Vantiv and JPMorgan.

Vantiv will pay roughly 385 pence for Worldpay - 55 pence in cash plus 0.0672 Vantiv shares per Worldpay share plus a cash dividend of 5 pence per Worldpay share.

Worldpay would announce an 8.5 billion pounds ($10.97 billion) deal with Vantiv later on Wednesday, Sky News reported.

A concrete offer must be made by August 1 under British takeover law.

Worldpay and Vantiv said in a joint statement that the merger would create a "world class payments group" and that there are "substantial opportunities" for cost synergies.

JPMorgan confirmed it had been at "a very early stage" in considering bidding for Worldpay, but decided not to make an offer.

Analysts suggested other companies might now be interested in making a bid.

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Both companies said there was compelling reasons for the merger, with the enlarged group having strong positions in four core regions of the US, Europe, Asia-Pacific and South America. The company had a blockbuster £4.8 billion ($7.4 billion) IPO in 2015.

The company was listed two years ago and is a constituent of the FTSE 100 index.

Rival suitor JP Morgan Chase has withdrawn.

- Worldpay is being advised on its deal with Vantiv by Goldman Sachs. Gordon Smith, chief executive officer of the bank's consumer-banking division, said last month that the MCX deal was "something we'd like to do more of, to look for technologies that we can acquire that will facilitate and accelerate our growth".

The deal, if completed, would expand the geographic footprint of the Cincinnati-based Vantiv, giving it reach outside the United States, where it provides payment and technology services to merchants and financial institutions.

The approaches showed how automated payment specialists have become attractive targets for credit card companies, banks and tech firms amid the growing popularity of paying by smartphone as consumers shun cash. It was previously owned by Royal Bank of Scotland, which sold the payments processor in 2010 to private equity firms Advent and Bain Capital as part of the terms of the bank's 2008 taxpayer bailout.


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