Fidelity National Information Services, Inc. (FIS) Agreement for GTCR to Acquire Majority Stake in Worldpay Call Transcript

Summary of FIS and GTCR Acquisition of Worldpay Company and Industry - Company: Fidelity National Information Services, Inc. (FIS) - Industry: Financial Technology and Payment Solutions Core Points and Arguments - Acquisition Agreement: FIS has signed a definitive agreement for GTCR to acquire a 55% stake in Worldpay, valuing the company at $18.5 billion, which includes$1 billion in contingent consideration based on GTCR's returns exceeding certain thresholds [5][6] - Valuation Multiple: The transaction reflects a 9.8-times multiple on expected fiscal 2023 adjusted EBITDA, which is a 20% premium to FIS' recent valuation of approximately 8 times [6][7] - Separation Strategy: This transaction accelerates FIS' plan to create two independent companies, enhancing strategic flexibility and maximizing shareholder value [5][8] - Proceeds and Financial Impact: FIS will receive approximately $11.7 billion in net proceeds at closing, allowing the company to deleverage to approximately 2.5 times, ensuring an attractive investment-grade credit rating [8][9] - **Retained Interest**: FIS will retain a 45$2 trillion in payments volume in 2022 [10] - GTCR's Commitment: GTCR will invest up to $1.25 billion in equity capital to support Worldpay's growth and competitive position [10] Additional Important Content - Commercial Relationships: The ongoing commercial agreements between FIS and Worldpay will preserve integrated value propositions for clients, minimizing potential dis-synergies [11] - Future Outlook: FIS is focused on improving business performance, free cash flow, and capital allocation, with a commitment to innovation and operational efficiency [14][15] - Second Quarter Expectations: FIS anticipates strong second quarter results, with revenue, adjusted EBITDA, and adjusted earnings per share expected to exceed the midpoint of guidance ranges [13][16]