Fiserv, a services provider to the financial and insurance industries, and CheckFree have entered into a definitive agreement whereby Fiserv will acquire CheckFree in an all-cash transaction valued at approximately $4.4 billion. CheckFree offers financial e-commerce services and products, including online banking, electronic payments, and infrastructure and services. Under terms of the agreement, CheckFree shareholders will receive $48 in cash for each share of common stock.
CheckFree and Fiserv have complementary technology, services, and business models. Fiserv anticipates the combined organization will deliver a wider range of product and service offerings for customers as well as provide opportunities for improved growth and efficiency, including the ability to bring new solutions to market faster.
"CheckFree's industry-leading payment and Internet banking capabilities will significantly accelerate our strategic transformation, extending our service platform to the largest financial institutions," says Jeffery Yabuki, president and CEO of Fiserv. "This combination allows us to deliver the best available solutions to all of our clients to enhance growth today and into the future. An important objective of the transaction is to integrate tightly electronic bill payment and settlement capabilities with our core account processing and risk management solutions to create a unique value proposition unrivaled in the marketplace today."
"By joining our complementary technology and capabilities with Fiserv, this new combined entity will broaden Fiserv's offerings to customers worldwide," says Pete
Kight, CheckFree chairman and CEO. "In particular, it will significantly accelerate the delivery of next-generation services to financial institutions and their customers. CheckFree's offerings also will enable Fiserv to round out its ability to deliver solutions that address the challenges of an evolving U.S. payments landscape and help facilitate the growth of the managed accounts industry."
In conjunction with the closing of the transaction, Kight will be employed by Fiserv and appointed to its board of directors.
Fiserv expects to realize more than $100 million in annualized cost savings and more than $125 million in annualized revenue synergies. The transaction is expected to be completed by December 31, 2007, subject to regulatory approvals, approval by the CheckFree shareholders, and customary closing conditions. After closing, the combined company will have pro-forma revenue of about $6 billion and employ more than 27,000 associates worldwide.
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