UK ATM operator Cardpoint is to undertake a reverse takeover of rival outfit Moneybox for £87.3 million in cash.
Under the deal Cardpoint will pay 43 pence per share for Moneybox, which is 22.9% higher the closing price of 35 pence on 30 March 2005, the day before Moneybox first announced the bid approach.
In a statement, Cardpoint says it will fund the deal by placing 43.3 million new shares to raise around £55m, and a loan of £80m provided by the Bank of Scotland.
Cardpoint said on Tuesday it was in advanced talks with Moneybox, although there had been speculation about a possible counter-bid from US-based TRM, which already has an 8.8% stake in Moneybox.
The deal will make Cardpoint one of the UK's biggest operators of fee-charging ATMs in terms of transactions. Cardpoint says the acquisition represents an opportunity to significantly increase the scale of its business and improve operating margins by reducing costs.
Around two thirds of Moneybox's 3000 ATMs are currently located in convenience stores, although the company recently announced plans to roll out freestanding kiosks in "high footfall locations" such as shopping centres. As well as operating fee-charing ATMS in the Britain, Germany and The Netherlands, Moneybox provides payment processing, cashless payment and access control systems in the UK. The firm recently reported strong profit growth for the first half of 2005 after posting a full year loss of £3.42 million in 2004.
Commenting on the acquisition, Mark Mills, CEO, Cardpoint, says: "Moneybox has built a strong market position in the UK, Germany and The Netherlands, and we intend to solidify the enlarged group's position further by combining the key strengths of both businesses."
Currently around 40% of the 54,000+ ATMs in the UK charge customers for withdrwaing cash. The Nationwide Building Society, which has for called for clearer labelling of fee-charging machines, recently forecast that UK consumers will pay £200m for cash withdrawals at fee-charging ATMs this year, compared with £140m in 2004.
Last year Cardpoint bought 816 offsite cash machines from UK bank HBOS in a deal worth £76.5 million last year in a move criticised by consumer rights groups and MPs investigating the rising number of fee-charging cash machines in the UK.