FIS SunGard Acquisition Broadens Enterprise Banking Reach

Banking and payments tech giant Fidelity National Information Services (FIS) said Wednesday (Aug. 12) that it is acquiring SunGard, the financial software company, in a cash-and-stock deal worth $9.1 billion (or $5.1 billion sans net debt).

The combined company will have more than $9.2 billion in annual sales, according to a release.

The deal would effectively end a decade-long stewardship of SunGard by a group of private equity firms, which in turn had been readying the company for an initial public offering this year, according to The Wall Street Journal. The buyout by FIS is slated to be closed before the end of the fourth quarter of this year, the companies said in the release. Upon closing, the combined entity will have more than 55,000 employees and a client roster that spans more than 100 countries around the globe.

WSJ noted Wednesday that the private equity owners have notched only about 1.5x the cash they originally invested in the deal. The group of investors that took SunGard private in 2005 included marquee names such as KKR & Co., Blackstone Group LP, Bain Capital, Silver Lake Partners and others.

In that deal, which was one of the larger software buyouts in the heady days before the Great Recession, the group paid $11.4 billion for SunGard, with the cash component of that amounting to about $3.5 billion.

Under the terms of the Wednesday agreement, FIS will refinance SunGard’s debt, which comes out to about $4.7 billion.

And, beyond financial engineering and speaking strategically, the financial services giant — which has a hand in everything from credit card transaction processing to auto loans to money management operations — said its product suite and SunGard’s own offerings will work together in a complimentary manner, with contribution from the latter’s own financial services and public sector products.

[vc_row full_width=”” parallax=”” parallax_image=””][vc_column width=”1/1″][/vc_column][/vc_row][vc_row full_width=”” parallax=”” parallax_image=””][vc_column width=”1/1″][vc_separator color=”grey” align=”align_center” style=”” border_width=”” el_width=””][vc_single_image image=”148412″ alignment=”center” style=”vc_box_shadow_3d” border_color=”grey” img_link_large=”” img_link_target=”_blank” css_animation=”left-to-right” img_size=”full” link=”http://www.pymnts.com/whats-hot-today/”][vc_column_text css_animation=””]

To check out what else is HOT in the world of payments, click here.

[/vc_column_text][vc_separator color=”grey” align=”align_center” style=”” border_width=”” el_width=””][/vc_column][/vc_row]