New York-based international payment systems provider ACI Worldwide announced today that it has proposed to buy out the outstanding shares of S1 Corporation, an Atlanta-based provider of payment, online banking and branch banking solutions worldwide. ACI is offering $9.50 per share in cash and stock, for a total value of about $540 million -- a 33 percent premium over S1's closing price yesterday.
In a news release issued this morning, ACI stated that combining the two complementary companies would create "a compelling opportunity to establish a full-service global leader of financial and payments software with significant scale."
This proposal competes with an offer made last June by Fundtech, an ACI competitor based in Jersey City, N.J. Fundtech proposed a stock-for-stock merger with S1 in order to create a combined $700 million company. If completed, the merger would give Fundtech shareholders 2.72 shares of S1 common stock for each Fundtech ordinary share they owned.
ACI's proposal offers S1 shareholders a choice between a combination of cash and/or stock for their shares, subject to proration based on a breakdown of 40 percent ACI stock and 60 percent cash. The stock portion would be tax-free to S1 shareholders.
"We believe that our premium stock and cash proposal is both financially and strategically superior to your proposed transaction with Fundtech," said Philip G. Heasley, ACI president and CEO, in a proposal letter to S1's Board of Directors.