18 October 2017

Fidelity to recapitalise information services unit and sell 25% stake

09 December 2004  |  3775 views  |  0 cash - dollars - lots of

Fidelity National Financial (FNF) is to recapitalise its information services unit and sell a 25% stake to equity firms Thomas H Lee Partners and Texas Pacific Group for $500 million.

FNF's information services unit provides processing services, consulting and application software to the financial services and mortgage industries.
Ealier this year FNF said it planned to spin-off the business in a $500 million IPO but later abandoned the move.

In a statement, FNF says it will recapitalise the unit through a $2.8 billion credit line. On completion of the transaction, company stockholders will receive a speccial cash dividend of $10 per share. The firm expects to pay the dividend, which will total $1.8 billion, during the first quarter of 2005.

The remaining proceeds will be used to repay bank debt and for general corporate purposes, including the potential repurchase of FNF stock.

The equity investment by Thomas H Lee Partners and Texas Pacific Group values the unit at $2 billion, excluding the new debt. The 25% sale will result in a gain of approximately $375 million for FNF.

Under the deal, William Foley would remain chairman of the board and CEO of Fidelity Information Services and the equity groups would receive proportional representation on the unit's board of directors.

Foley says a number of alternatives were investigated before the embedded value of FIS was recoginsed, adding that the deal with the equity firms was "another step in unlocking the value of FIS by providing an independent, third-party valuation".

Comments: (0)

Comment on this story (membership required)

Finextra news in your inbox

For Finextra's free daily newsletter, breaking news flashes and weekly jobs board: sign up now

Related stories

Egg offloads funds supermarket to Fidelity

Egg offloads funds supermarket to Fidelity

19 October 2004  |  8375 views  |  0 comments
Fidelity to buy InterCept; postpones IPO

Fidelity to buy InterCept; postpones IPO

09 September 2004  |  5791 views  |  0 comments
Fidelity National Financial books passage to India with Covansys

Fidelity National Financial books passage to India with Covansys

27 April 2004  |  8144 views  |  0 comments
Fidelity National Financial acquires Bankware and Pro-Soft

Fidelity National Financial acquires Bankware and Pro-Soft

07 April 2004  |  7818 views  |  0 comments
Fidelity National Financial to acquire Aurum Technology

Fidelity National Financial to acquire Aurum Technology

09 February 2004  |  6131 views  |  0 comments
Fidelity National Financial acquires Sanchez

Fidelity National Financial acquires Sanchez

29 January 2004  |  7591 views  |  0 comments

Related company news

 

Related blogs

Create a blog about this story (membership required)
visit www.vasco.comvisit www.capgemini.comvisit www.innotribe.com

Top topics

Most viewed Most shared
Ripple looks to drive bank adoption with $300m XRP rebate programmeRipple looks to drive bank adoption with $...
15266 views comments | 12 tweets | 4 linkedin
Swift positive on blockchain, but big challenges remainSwift positive on blockchain, but big chal...
8462 views comments | 16 tweets | 21 linkedin
hands typing furiouslyHow artificial intelligence can deliver a...
7954 views 0 | 7 tweets | 9 linkedin
satelliteGates Foundation backs Ripple collaboratio...
7428 views comments | 13 tweets | 8 linkedin
IBM uses blockchain to improve cross-border payments processingIBM uses blockchain to improve cross-borde...
6582 views comments | 8 tweets | 16 linkedin

Featured job

Competitive base, commission, benefits
London, UK

Find your next job