Fidelity National Information Services, Inc. to Acquire Metavante Technologies,
Inc.
JACKSONVILLE, Fla. and MILWAUKEE, April 1 /PRNewswire-AsiaNet/ --
Combination to create the world's largest provider of
comprehensive integrated payment and financial core processing services
Companies anticipate $260 million in cost synergies and
increased long-term organic revenue growth
Fidelity National Information Services, Inc. (NYSE: FIS) and Metavante
Technologies, Inc. (NYSE: MV) today announced that the boards of directors of
both companies have approved a definitive agreement under which FIS will
acquire Metavante. Under the terms of the agreement, Metavante shareholders
will receive a fixed exchange ratio of 1.35 shares of FIS common stock for
each share of Metavante common stock they own. The pro forma enterprise value
of the combined company is approximately $10 billion.
The combination creates an industry leader with enhanced growth
prospects. FIS is a leading provider of core and transaction processing
services, card issuer solutions and outsourcing services to more than 14,000
financial institutions worldwide. Metavante is a leading provider of banking
and payments technologies to approximately 8,000 financial services firms and
businesses. Together, the combined company will provide one of the most
comprehensive ranges of integrated products and services, across more markets
and more geographies worldwide than any other provider in the industry.
The pro forma financial implications are compelling. FIS and Metavante
serve complementary customer bases and have highly diversified and recurring
revenue streams. In 2008, the companies generated pro forma combined revenue
of $5.2 billion, adjusted EBITDA of $1.3 billion and free cash flow of more
than $500 million. As a result of the combination, FIS anticipates it will
achieve cost synergies of approximately $260 million. The increased global
scale and expected cost savings are expected to generate significant margin
expansion. The transaction is expected to be accretive to adjusted earnings
per share in 2010.
"The combined scale, complementary product capabilities and market
breadth of these two great companies will drive significant competitive
advantages in the increasingly dynamic marketplace," stated William P. Foley,
II, chairman of FIS. "This transaction will further strengthen FIS's
competitive position as a leading global provider of technology solutions and
enable us to generate increased value for shareholders and customers," added
Lee A. Kennedy, FIS president and chief executive officer.
"By bringing these two companies together, we expect to accelerate
revenue growth, drive higher profitability, and create greater financial
flexibility for growth investments and acquisitions," said Frank R. Martire,
Metavante's current chairman and chief executive officer. "In addition, the
size, scope and geographic reach of the combined company will offer even
greater opportunities to our employees, world-wide."
The leadership team will be comprised of executives from both companies
with broad industry experience and strong management depth. Mr. Foley will
serve as chairman of the board of FIS. Mr. Kennedy will serve as executive
vice chairman of the board with responsibility for integrating the two
companies, and Mr. Martire will be named president and chief executive
officer of FIS. Reporting to Mr. Martire will be Gary A. Norcross as chief
operating officer (current COO of FIS) and Michael D. Hayford as chief
financial officer (current president and COO of Metavante). George P. Scanlon
(current chief financial officer of FIS) will serve as executive vice
president of finance. Following the completion of the transaction, the board
of directors will consist of six FIS board members and three Metavante
directors. FIS's headquarters will remain in Jacksonville, Florida.
Additional Transaction Details
The transaction will be structured as a tax-free reorganization whereby
Metavante will be merged with and into a newly formed subsidiary of FIS.
Based on the 1.35 fixed exchange ratio, FIS would issue approximately 162
million basic shares to Metavante shareholders. In addition, a simultaneous
equity investment by affiliates of Thomas H. Lee Partners, L.P. and Fidelity
National Financial, Inc. in FIS common stock will result in approximately 16
million additional newly issued shares. At closing, the combined company
would have approximately 374 million fully diluted shares outstanding. The
requisite Metavante lenders have agreed to waive their change of control
provisions and permit the merger to proceed. After giving effect to the
transaction, the combined company is projected to have approximately $3.8
billion of debt outstanding at closing, including $1.45 billion of debt to be
incurred and assumed in connection with the acquisition and will have
improved financial leverage and credit statistics.
Approvals and Anticipated Closing
The transaction is subject to approval by FIS and Metavante shareholders,
receipt of regulatory approvals and the satisfaction of customary closing
conditions. Metavante said that its largest shareholder, an entity affiliated
with Warburg Pincus that currently owns 25% of the outstanding common stock
of Metavante, has entered into a Support Agreement with FIS pursuant to which
it has agreed, subject to the terms and conditions of the Support Agreement,
to vote in favor of the transaction. Upon completion of the deal, Warburg
Pincus will be the largest single shareholder of the new company with
approximately 11% ownership and will have board representation. FIS and
Metavante expect to complete the transaction in the third quarter of 2009.
2009 Guidance
FIS will update its fiscal 2009 guidance to include the acquisition of
Metavante following the completion of the transaction. Separately, FIS and
Metavante have reiterated the respective guidance each had previously
provided in February 2009.
Advisors
Banc of America Securities LLC and Goldman, Sachs & Co. acted as
financial advisors to FIS and Wachtell, Lipton, Rosen & Katz provided legal
counsel. Barclays Capital acted as financial advisor to Metavante, while
Kirkland & Ellis LLP and Quarles & Brady LLP provided legal counsel.
Conference Call and Webcast
FIS and Metavante will host a joint webcast to discuss the transaction on
Wednesday, April 1, 2009, at 11:00 a.m. EDT. The webcast will be accessible
on the investor relations section of FIS's website at
The accompanying slide presentation will also be available on each company's
website. A replay of the audio presentation will be available on the websites
or by calling 888-203-1112 (domestic) or 719-457-0820 (international), and
entering passcode 1456372. The replay will be available for four weeks
following the conference call.
About Fidelity National Information Services, Inc.
Fidelity National Information Services, Inc. (NYSE: FIS), a Fortune 500
company, is a leading provider of core processing for financial institutions;
card issuer and transaction processing services; and outsourcing services to
financial institutions and retailers. FIS has processing and technology
relationships with 40 of the top 50 global banks, including nine of the top
10. FIS is a member of the S&P 500 Index and has been ranked the number one
banking technology provider in the world by American Banker and the research
firm Financial Insights in the annual FinTech 100 rankings. Headquartered in
Jacksonville, Fla., FIS maintains a strong global presence, serving more than
14,000 financial institutions in more than 90 countries worldwide. For more
About Metavante
Metavante Technologies, Inc. (NYSE: MV) is the parent company of
Metavante Corporation. Metavante Corporation delivers banking and payments
technologies to approximately 8,000 financial services firms and businesses
worldwide. Metavante products and services drive account processing for
deposit, loan and trust systems, image-based and conventional check
processing, electronic funds transfer, consumer healthcare payments,
electronic presentment and payment, outsourcing, and payment network
solutions including the NYCE Network, a leading ATM/PIN debit network.
NYCE are registered trademarks of Metavante Corporation, which is the
principal subsidiary of Metavante Technologies, Inc.
Use of Non-GAAP Financial Information
Generally Accepted Accounting Principles (GAAP) is the standard framework
of guidelines for financial accounting. It includes the standards,
conventions, and rules accountants follow in recording and summarizing
transactions, and in the preparation of financial statements. In addition to
reporting financial results in accordance with GAAP, the Company has provided
non-GAAP financial measures which it believes are useful to help investors
better understand its financial performance, competitive position and
prospects for the future. These non-GAAP measures include earnings before
interest, taxes, depreciation and amortization ("EBITDA"), adjusted EBITDA,
and free cash flow. Adjusted EBITDA excludes the after-tax impact of merger
and acquisition and integration expenses, certain stock compensation charges,
debt restructuring and other costs, and gains (losses) on the sale of certain
non-strategic assets. Any non-GAAP measures should be considered in context
with the GAAP financial presentation and should not be considered in
isolation or as a substitute for GAAP net earnings. Further, FIS's and
Metavante's non-GAAP measures may be calculated differently from
similarly-titled measures of other companies.
Forward Looking Statements
This press release contains statements related to FIS's and Metavante's
future plans, objectives, performance, events and expectations, including
statements about revenue and cost synergies and earnings accretion and, as
such, constitutes "forward-looking statements" within the meaning of the
Private Securities Litigation Reform Act of 1995, Section 27A of the
Securities Act of 1933, as amended, and Section 21E of the Securities
Exchange Act of 1934, as amended. These forward-looking statements are
subject to known and unknown events, risks, uncertainties and other factors
that, individually or in the aggregate, may cause actual results, performance
or achievements of FIS and Metavante to be different from those expressed or
implied within this presentation. The material risks and uncertainties that
could cause actual results to differ materially from current expectations
include, without limitation, the following: (i) effect of governmental
regulations, including the possibility that there are unexpected delays in
obtaining regulatory approvals; (ii) the economy; (iii) competition; (iv) the
risk that the merger may fail to achieve beneficial synergies or that it may
take longer than expected to do so; (v) the risk of reduction in revenue from
the elimination of existing and potential customers due to consolidation in
the banking, retail and financial services industries and its impact on the
Companies' customer bases; (vi) failure to adapt to changes in technology or
in the marketplace; (vii) the failure to obtain approval of FIS's and
Metavante's shareholders; (viii) delays associated with integrating the
companies, including employees and operations, after the transaction is
completed; (ix) actions that may be taken by the competitors, customers and
suppliers of FIS or Metavante that may cause the transaction to be delayed or
not completed; and (x) other risks detailed from time to time in the Form
10-K and other reports and filings made by FIS and Metavante with the
Securities and Exchange Commission ("SEC") that are available on the SEC's
Factors" in FIS's and Metavante's Form 10-K for the fiscal year ended
December 31, 2008. Readers are strongly urged to read the full cautionary
statements contained in those materials. We assume no obligation to update
any forward-looking statements to reflect events that occur or circumstances
that exist after the date on which they were made.
Additional Information and Where to Find It
In connection with the proposed transactions, FIS and Metavante will file
relevant materials with the SEC, including a registration statement on Form
S-4 that will include a joint proxy statement of FIS and Metavante that also
constitutes a prospectus of FIS. FIS and Metavante will mail the final joint
proxy statement/prospectus to their respective shareholders. Investors and
security holders are urged to read these documents (if and when they become
available) and any other relevant documents filed with the SEC, as well as
any amendments or supplements to those documents, because they will contain
important information about FIS, Metavante and the proposed transactions.
Investors and security holders may obtain these documents (and any other
documents filed by FIS or Metavante with the SEC) free of charge at the SEC's
website at www.sec.gov. In addition, the documents filed with the SEC by FIS
may be obtained free of charge by directing such request to: Investor
Relations, 601 Riverside Drive, Jacksonville, FL 32204, or from FIS' Investor
documents filed with the SEC by Metavante may be obtained free of charge by
directing such request to: Investor Relations, 4900 West Brown Deer Road,
Milwaukee, WI 53223 or from Metavante's Investor Relations page on its
Participants in the Solicitation
FIS, Metavante and their respective executive officers, directors and
certain other members of management and employees may be deemed to be
participants in the solicitation of proxies from the shareholders of
Metavante and FIS in favor of the proposed transactions. Information
regarding the persons who may, under the rules of the SEC, be considered
participants in the solicitation of the shareholders in connection with the
proposed transactions will be set forth in the joint proxy
statement/prospectus when it is filed with the SEC. Information about the
executive officers and directors of FIS and their ownership of FIS common
stock is set forth in the proxy statement for FIS's 2008 Annual Meeting of
Shareholders, which was filed with the SEC on April 15, 2008. Information
about the executive officers and directors of Metavante and their ownership
of Metavante common stock is set forth in the proxy statement for Metavante's
2008 Annual Meeting of Shareholders, which was filed with the SEC on April
11, 2008.
SOURCE Fidelity National Information Services, Inc.
CONTACT: Mary K. Waggoner, Senior Vice President of Investor Relations,
FIS, +1-904-854-3282, or Marcia Danzeisen, Senior Vice President Marketing
and Corporate Communications, FIS, +1-904-854-5083; or Kirk Larsen, Treasurer
and Vice President of Investor Relations of Metavante Corporation,
+1-414-357-3553, or Chip Swearngan, Vice President, Corporate Communications,
of Metavante Corporation, +1-414-357-3688
(FIS MV)
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