Fidelity National Deal Could Approach $15 Billion

NEW YORK (Reuters) – A private equity deal for Fidelity National Information Services Inc (FIS.N), currently being negotiated, could be worth around $15 billion if a buyout is agreed, a source familiar with the situation said on Tuesday.

Three big private equity firms have teamed up to bid for Fidelity National, sources familiar with the situation said on Thursday, a deal that, if completed, would rank as the biggest leveraged buyout since the financial crisis hit.

Blackstone Group (BX.N), Thomas H. Lee Partners and TPG Capital are in talks to buy the company, which provides payment processing and other banking services and has a market value of more than $11 billion, those sources said.

A deal at that price could equate to around $32 a share, one source said on Tuesday, and could be reached by May 16, two sources said. Fidelity National’s shares closed on the New York Stock Exchange on Tuesday at $28.86.

The potential price of the deal was first reported by Bloomberg.

If the deal gets done, it would provide evidence that big-money buyouts are returning after credit markets plunged into a deep freeze because of the economic downturn.

It would also be the latest sign that M&A is picking up for the payment-processing industry, which has seen other firms go on the block such as a unit of Royal Bank of Scotland Group Plc (RBS.L) and privately held North American Bancard Inc.

Three banks, JPMorgan Chase & Co (JPM.N), Citigroup Inc (C.N) and Bank of America Corp (BAC.N) are leading the financing for the potential buyout, a source familiar with the situation previously said.

Fidelity National, which traces its history to the 1960s, is a former subsidiary of Fidelity National Financial and was spun off into a separate company in 2006. Last year it struck a $2.94 billion deal to buy Metavante Technologies. 

Large leveraged buyouts have been pretty much extinct since the summer of 2007, when the financial crisis halted most financing for big deals, banks were stuck with debt and the economy froze. 

Since then, the economy and stock markets have begun to recover, and confidence is returning to the banking sector. Bankers and private equity firms have started viewing mega-buyouts of $10 billion or more as achievable — something that was not even on the radar just six months ago. (Reporting by Megan Davies; Editing by Muralikumar Anantharaman)