Private equity giant Blackstone is paying $820 million for a 17% stake in ATM manufacturer NCR, which intends to use the money to accelerate its transformation into a software and services firm and embark on a share buyback programme.
Blackstone, which is understood to have tried to buy NCR over the summer, will make the investment in the form of perpetual convertible preferred shares and will get two members on an expanded NCR board of 11.
The investment comes as NCR - and the ATM market in general - comes to terms with a rapidly changing landscape. Last month rival Diebold confirmed that it is in takeover talks with Wincor Nixdorf in a deal that would value the German firm at nearly $2 billion.
NCR appears to have now decided against a sale or merger, and will concentrate on a new software-focused direction spearheaded by its recently launched cloud-based system for ATMs.
"After concluding a comprehensive review of strategic alternatives, the NCR Board has determined that executing our strategic plan with Blackstone’s assistance is the best way to accelerate NCR’s transformation and build long-term shareholder value," says NCR chairman and CEO Bill Nuti.
The Blackstone injection will also contribute to a planned $1 billion share repurchase through a modified 'Dutch Auction' tender offer at an expected price range between $26.00 and $29.50 per share expected to commence on Friday.