Verifone ‘Go Shop’ Period Expires, Clears Path For ‘Go-Private’ Deal

Verifone said Friday that the “go shop” period under the terms of its merger agreement with Vertex Holdco has expired, paving the way for Verifone to be acquired by the latter in a deal that takes the payments giant private.

Under the mechanics of the deal, said Verifone in a statement, the company will be acquired by affiliates of Francisco Partners, including British Columbia Investment Management Corp.

As for the queue of potential bidders, the “go shop” period produced 42 possible buyers. Among that tally, four firms executed nondisclosure agreements and were privy to some information regarding the firm, but none submitted acquisition proposals.

With the expiration of the “go shop” period, the deal is slated to close in the current quarter, once approval comes from Verifone stockholders and regulators.

The deal, announced in April, comes to $3.4 billion, across cash and debt.

Qatalyst Partners served as financial adviser to Verifone through the process, and the Verifone board has already approved the deal.

Company-specific news showed some traction in business fundamentals and traction that might have attracted the deal.

The latest earnings results posted by the firm showed that core business lines in systems were up by double-digit percentages in the first quarter, year over year, driven by newer devices such as Carbon and mobile point-of-sale (mPOS) offerings, where mPOS has been growing by double digits. Beyond technology, services gained 11 percent year over year.

In discussing Carbon specifically, CEO Paul Galant stated during the conference call that “we are completing several important certifications [for] acquirers to begin pilots and distribution into their vast merchant ecosystems. We have also started to execute directly with the ISO channel, which will extend Carbon further downstream into Tier 3 and Tier 4 merchants.”

Carbon also will get a boost from Paysafe via a partnership where the ISO will white label the Verifone Connect service platform and offer both Carbon and Engage solutions to small businesses across North America.

The company has a goal to connect more of the 30 million devices in that region and is on track to connect 2 million devices through the end of 2018.