My wife and I took a little breather from the bay breezes of Cape Cod to experience the value of NYC's high-culture. For her, it meant haute couture as well. The Fiserv/CheckFree announcement reached me from the telephone messages left at my Dallas office, and from what I read in the WSJ. I had a few opinions about the deal.

For example, three years ago, I had told a reporter at the American Banker that CKFR was a ripe acquisition. This time, I probably reacted more strongly to the price paid for CKFR. You see, I had just paid five bucks for a 8-ounce bottle of Coke, so all of a sudden, FISV's $4.4 billion purchase seemed more reasonable. For what it's worth, I'm offering Jeff Yabuki my justifications for the $5 Coke, along with some equivalent rationalizations he might want to use to address critics who use their own models for fair pricing.

Me: At 96 degree temperatures in Manhattan, I might have suffered dehydration if I hadn't had something to drink.
Jeff: This deal should keep the heat of Wall Street off our backs for a while.

Me: If they had to rush me to Mt. Sinai Hospital, I might have paid $180 for a glass of tap water.
Jeff: The bargains have all but disappeared, and it is now a seller's market. One pays the going price to keep the growth momentum going.

Me: If I had not slept in my bed at the Alex Hotel, they would have charged me anyway. Who knows what Mt. Sinai would have charged for one night?
Jeff: If we didn't buy CKFR, the other $5 billion competitor would have. This is not a time for tough negotiations.

Me: Henry Clay Frick paid $4,000 for a self portrait by Rembrandt. I paid only $10 to see it at the Frick, as I was calculating the painting's value in today's market. If I keep the green Coke bottle for a hundred years, my heirs could sell it and get the five bucks back, maybe more.
Jeff: We're a long term player with a value-add factor applied to every acquisition we make. This investment will look like a bargain some day.

Me: A trip to NYC would not be complete without dinner at Provence in Soho. Personally, I thought the waiter oversold "le cochon roti avec des abricots" to my wife. At dessert time the waiter was waiting for my wife's reaction to his entrée recommendation, and she gently told him it was a disappointment. When the check arrived, I noticed the price of the roast pig was stricken. That was like a six-Coke return on my earlier investment.
Jeff: We're keeping Peter Kight on the payroll and adding him to the board. If things don't work out (very unlikely in that only four out of 149 acquisitions hadn't made the grade), Pete might buy back CKFR.

Full disclosure: My vacation is coming to a close, folks, and I'll soon be back in Dallas acting just a tiny bit more serious. A bientot.

- Art Gillis
www.artgillis.com

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