11:02 AM
Connect Directly

Fidelity National to Acquire Metavante

Jacksonville, Fla.-based Fidelity National Information Services (FIS) announced it plans to acquire Metavante (Milwaukee) in a stock deal valued at $2.94 billion. 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.

According to a release, FIS anticipates it will achieve cost synergies of approximately $260 million with the combined company. The transaction is expected to be accretive to adjusted earnings per share in 2010.

FIS provides core and transaction processing services, card issuer solutions and outsourcing services to more than 14,000 financial institutions worldwide. Metavante offers banking and payments technologies to approximately 8,000 financial services firms and businesses. The companies claim that when combined, they 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.

Aite Group's research director Christine Barry commented on the deal in a statement, saying the combination would put a combined FIS/Metavante in an ideal position to take on Fiserv. "Increasingly stringent regulations and demands for greater information and transparency are driving financial institutions toward even greater vendor consolidation. In such an environment most institutions are now viewing bigger as better and this merger is placing both institutions in a better position to compete against Fiserv—the 800 pound gorilla prior to this announcement—especially in the smaller bank market where much of the technology spending activity is currently taking place."

Barry also said the acquisition would enable each to expand their reach to one another's markets. For FIS, it helps its U.S. footprint. For Metavante, she said, it adds to its overseas efforts.

Comment  | 
Print  | 
More Insights
Register for Bank Systems & Technology Newsletters
White Papers
Current Issue
Bank Systems & Technology - August 2014
Modern core systems are emerging as the foundations of effective channel integration and customer engagement initiatives.
Bank Systems & Technology Radio
Archived Audio Interviews
New IT Models for New Financial Services Challenges