Fiserv to acquire EDS credit union business for $218 million cash
14 July 2003 | 4218 views | 0
Fiserv has signed a definitive agreement to acquire the EDS Credit Union Industry Group (CUIG) for $218 million in cash.
Under the agreement, first mooted last month, EDS also will retain $12 million in CUIG receivables. The acquisition already has received regulatory approval and is expected to close in the near future.
The Credit Union Industry Group specialises in core processing and provides a variety of other products and services, including debit card and transaction processing, electronic banking and lending and online bill payment and presentment services. The business supports about 1000 credit unions and generates approximately $115 million in annual processing and services revenues.
CUIG employs 450 people, primarily in Plano, Texas; Huntersville, North Carolina; Phoenix, Arizona; Madison, Wisconsin; Orlando, Florida; Auburn Hills, Michigan; San Antonio, Texas and St. Louis, Missouri. Employees of the unit will become Fiserv employees after a transition period.
Scott Butler, president at CUIG, says the transaction will be good for clients and staff because Fiserv considers credit union processing core to its business and plans to continue to invest in its growth. Butler will continue as president at the unit as part of Fiserv.
"Fiserv is making a commitment to increase the investment in products and services for our clients," Butler says. "Equally important, our clients can continue to count on quality service delivered by the same CUIG professionals."
EDS says the sale of CUIG is part of its effort, announced last year, to divest certain non-core, non-strategic assets. Upon closing of the CUIG sale, EDS will have raised approximately $544 million in cash under its divestiture programme, excluding retained receivables.