FIS reverses course, now down after selling Worldpay stake for $11.7 bln

Toshiba

06/07/2023 15:21

(Updates)
    ** Shares of payments processor Fidelity National
Information Services  FIS.N  reverses premarket gains to trade
2.42% lower at $58.36
    ** FIS says it is selling a majority stake in its merchant
solutions unit, Worldpay, to private equity firm GTCR for
proceeds of $11.7 bln 
        ** The deal values the merchant solutions unit at $18.5
bln
        ** "Deal expected to provide $11.7 bln in net proceeds,
which is $1.8 bln lighter than we had expected at the $17.5 bln
valuation level," say Jefferies analysts in a client note 
  
    ** FIS says it will retain 45% ownership in Worldpay 
    ** Co will use proceeds to pay down debt and return
additional capital to shareholders
    ** FIS acquired Worldpay for $43 bln in 2019; in Feb, FIS
took a 17.6 bln write-down on the business when it unveiled
plans to spin it off 
    ** Sixteen of 30 brokerages rate the stock "buy" or higher,
and 14 "hold"; their median PT is $70 - Refinitiv
    ** YTD, FIS down 14.09% including sessions move

 (Reporting by Pritam Biswas in Bengaluru)
 ((Pritam.Biswas@thomsonreuters.com))