(Reuters) – Global Payments Inc (GPN.N), the company which processes online credit card transactions, said it has agreed to sell its DolEx- and Europhil-branded money transfer businesses to an affiliate of Palladium Equity Partners LLC.
Under the terms, Global Payments will receive proceeds in the range of $85 million to $110 million based on the operating performance of the business at the time of closing, the company said in a statement.
“This transaction will allow us to focus exclusively on our ongoing strategy of expanding our merchant acquiring presence around the world, and as such, we intend to reinvest the sale proceeds in future merchant acquiring growth opportunities,” Chief Executive Paul Garcia said.
Analyst Tien-tsin Huang of J.P. Morgan Securities said the deal makes sense as the money transfer unit was non-core and had been a drag to margins and growth in recent years.
Excluding the money transfer segment, it expects revenue of $1.57 billion to $1.62 billion for fiscal 2010.
Earnings from continuing operations are expected to be $2.31 per share to $2.42 per share for the year, the company said.
Shares of the company were down 1 percent at $52.99 Wednesday morning on the New York Stock Exchange. (Reporting by Brenton Cordeiro in Bangalore; Editing by Ratul Ray Chaudhuri)