Verifone Systems Inc (NYSE: PAY), a U.S. provider of payments and commerce solutions at the point of sale, has agreed to be acquired by an investor group led by U.S. private equity firm Francisco Partners. The investor group, which includes British Columbia Investment Management Corp (BCI), will buy Verifone for US$23.04 per share in cash, representing a total consideration of about US$3.4 billion, including net debt. The company’s board has approved the take-private deal, which includes a go-shop period. It is expected to close in the third quarter. Founded in 1981, Verifone is based in San Jose, California.
Verifone to be Acquired by Francisco Partners for $3.4 Billion
April 9, 2018
Verifone Stockholders to Receive $23.04 Per Share in Cash
Transaction Provides Significant Cash Premium to Verifone Stockholders
SAN JOSE, Calif. and SAN FRANCISCO, Calif. – April 9, 2018 – Verifone Systems, Inc. (NYSE: PAY) (“Verifone” or the “Company”), a world leader in payment and commerce solutions, and Francisco Partners, a leading technology-focused private equity firm, today announced that they have entered into a definitive agreement under which an investor group led by Francisco Partners and including British Columbia Investment Management Corporation (“BCI”) will acquire Verifone for $23.04 per share in cash, representing a total consideration of approximately $3.4 billion, which includes Verifone’s net debt.
Under the terms of the agreement, Verifone stockholders will receive $23.04 in cash for each share of Verifone common stock held, representing a premium of approximately 54% to the Company’s closing share price of $15.00 on April 9, 2018. The Verifone Board of Directors has unanimously approved the definitive agreement and recommends that Verifone stockholders vote in favor of the transaction. Upon completion of the transaction, Verifone will become a privately held company.
Paul Galant, Chief Executive Officer of Verifone, said, “We are pleased to reach this agreement with Francisco Partners. This transaction delivers significant cash value to our stockholders and provides compelling benefits for our clients. We believe this transaction reflects the progress we have made executing our transformation from a terminal sales company to a payments and commerce solutions provider. With Francisco Partners’ resources, expertise and track-record growing global technology businesses, we are confident that we will be better positioned to serve the needs of our clients around the globe.”
“Verifone continues to build compelling and impressive products and technology and has attractive long-term growth prospects,” said Peter Christodoulo, Partner at Francisco Partners. “We are excited to become investors and stewards of this important platform in the global payments and commerce ecosystem.”
“Verifone’s transformation from a hardware provider to a best-in-class payments and commerce solutions provider is just beginning,” added Jason Brein, Partner at Francisco Partners. “We look forward to supporting the company as it continues its evolution.”
“This investment builds on the strength of our financial technology, systems and software franchises,” commented Dipanjan “DJ” Deb, co-founder & CEO of Francisco Partners. “Verifone will receive the highest focus of Francisco Partners as we support its continued growth and transformation in an increasingly software-centric world.”
The transaction is not subject to a financing condition and is expected to close during the third calendar quarter of 2018, subject to customary closing conditions, including receipt of stockholder and regulatory approvals. The merger agreement includes a “go-shop” period, which permits Verifone’s Board and advisors to actively initiate, solicit, encourage, and potentially enter into negotiations with parties that make alternative acquisition proposals through May 24, 2018. There can be no assurance that this process will result in a superior proposal, and Verifone does not intend to disclose developments with respect to the solicitation process unless and until the Board makes a determination requiring further disclosure.
Qatalyst Partners is acting as financial advisor to Verifone and Sullivan & Cromwell LLP is serving as Verifone’s legal advisor. Credit Suisse, Barclays and Royal Bank of Canada are acting as financial advisors and Kirkland & Ellis LLP is serving as legal advisor to the Francisco investor group. Credit Suisse, Barclays and Royal Bank of Canada have also provided committed debt financing for the transaction.
Verifone is transforming every day transactions into new and engaging opportunities for merchants and consumers at the last inch of payments and commerce. Powered by a growing footprint of more than 30 million devices in more than 150 countries, our people are trusted experts working with the world’s best-known retail brands, financial institutions, and payment providers. Verifone is connecting more products to an integrated solutions platform to better meet the evolving needs of our clients and partners. Built on a 35-year history of uncompromised security, we are committed to consistently solving the most complex payment challenges. Verifone.com | (NYSE: PAY) | @Verifone
About Francisco Partners
Francisco Partners is a leading global private equity firm, which specializes in investments in technology and technology-enabled services businesses. Since its launch over 18 years ago, Francisco Partners has raised over $14 billion in committed capital and invested in more than 200 technology companies, making it one of the most active and longstanding investors in the technology industry. The firm invests in opportunities where its deep sectoral knowledge and operational expertise can help companies realize their full potential. For more information, please visit www.franciscopartners.com.
About British Columbia Investment Management Corporation (BCI)
With C$135.5 billion of managed net assets as at March 31, 2017, British Columbia Investment Management Corporation (BCI) is one of Canada’s largest institutional investors within the global capital markets. Based in Victoria, British Columbia, BCI is a long-term investor that invests in all major asset classes including private equity. BCI’s clients include public sector pension plans, public trusts, and insurance funds. https://www.bci.ca
Marc Rothman: (408) 232-7299/[email protected]
Kwiyoung Baumgarten: (678) 358-6982/[email protected]
Eric Brielmann / Matthew Gross
Joele Frank, Wilkinson Brimmer Katcher
(415) 869-3950 / (212) 355-4449
Francisco Partners: [email protected]/(215) 657-4971
John Moore: [email protected]
Gwen-Ann Chittenden, Director, Communication & Government Relations: (778) 410-7156/[email protected]
Photo courtesy of Verifone Systems Inc