First Data Buys Payment Processor CardConnect for $750 Million
First Data will buy U.S.-based payments processor CardConnect for about $750 million in cash, including the repayment of debt, reports Paybefore sister publication Banking Technology. CardConnect processes about $26 billion of volume annually from about 67,000 merchant customers, which adds to First Data’s $2.2 trillion in annual transaction volume.
The Fintech Acquisition Corp. acquired FTS Holding Corp. in July 2016 and renamed it CardConnect. At that time, it traded shares of CardConnect on Nasdaq at approximately $14 per share.
In this latest deal, First Data will acquire all of the outstanding shares of common stock of CardConnect for $15 per share in cash.
CardConnect is a “long-standing” First Data distribution partner and it will incorporate its solutions “across some of our most important strategic initiatives such as partner-centric distribution, integrated payments and enterprise payments solutions,” said Frank Bisignano, First Data chairman and CEO.
The merger agreement has been unanimously approved by CardConnect’s board of directors. In addition, CardConnect shareholders holding approximately 40 percent of CardConnect common stock have entered into tender and support agreements to tender their shares of common stock into the tender offer and support the transaction.
The transaction is subject to the tender of a majority of the outstanding shares of CardConnect common stock as well as other customary closing conditions. The parties expect the transaction to close in the third quarter of 2017.