Cardtronics (Nasdaq:CATM) and Access to Money (OTCBB:AEMI) today announced that they have entered into a definitive agreement under which Cardtronics USA, a wholly-owned subsidiary of Cardtronics, will acquire Access to Money.
Under the terms of the agreement, Cardtronics will acquire all of the outstanding shares of Access to Money for a cash payment of $0.285 per share and retire all of Access to Money's outstanding indebtedness. The total cost to be paid at closing will be approximately $21.2 million. The companies expect an early fourth quarter completion date for the transaction. Access to Money provides ATM services to merchants and financial institutions, currently operating approximately 10,350 ATMs in the United States.
Combined Company Overview
Cardtronics is the world's largest retail ATM services provider, operating over 41,900 ATMs around the globe. Access to Money has established itself as a leading operator of merchant-owned ATMs, having secured ATM services contracts for approximately 9,700 ATMs with local and regional merchants, as well as operating nearly 650 ATMs that are company-owned across the U.S. Complementing Cardtronics' existing merchant-owned ATM operations, the combined company, including Access to Money's book of business, will operate nearly 18,000 merchant-owned ATMs, with customers ranging from single-store owners to well-known chain retailers. In total, the combined company will operate approximately 52,250 ATMs — encompassing both company- and merchant-owned machines.
The combination also expands Cardtronics' portfolio of well-known merchant relationships to include Kangaroo Express convenience stores (the primary operating banner of The Pantry) and a leading quick service restaurant (QSR) franchisor specializing in coffee and doughnuts. As part of a long-term contract announced in 2010, Access to Money operates approximately 1,400 ATMs throughout 11 Southeastern states for The Pantry, America's third largest company-operated convenience store chain. As an authorized ATM services provider, Access to Money also provides ATM services at nearly 500 of the QSR franchisor's U.S. locations, with the opportunity to expand further into its extensive network of franchisees. Additionally, Access to Money brings to the proposed merger a growing ATM services business focused on community banks and credit unions.
"Cardtronics' building and owning a proprietary ATM transaction processing infrastructure has helped unlock economies of scale on the company-owned ATM side of our business for a number of years now. The Access to Money acquisition not only offers the opportunity to extend our reach with leading retail brands, including Kangaroo Express, but it also allows us to bring a new level of scale to our merchant-owned business," said Steve Rathgaber, chief executive officer, Cardtronics.
Cardtronics will acquire all of the outstanding shares of Access to Money for a cash payment of $0.285 per share. The total cash consideration at closing will be approximately $21.2 million, inclusive of debt repayment. Up to an additional $5.25 million of consideration may be made to a subordinated lender of Access to Money, contingent upon the achievement of certain future performance thresholds that have been established for the acquired operations. In connection with the above, Access to Money's total outstanding indebtedness of $22.8 million will be considered retired in full as of the closing date. Cardtronics will fund the acquisition with its operating cash flow and its existing bank revolving line of credit.
2011 & 2012 Guidance
Cardtronics expects that the transaction will be neutral to adjusted net income per share in 2011, accretive to adjusted net income per share in 2012 and increasingly accretive going forward as synergies are fully realized. Cardtronics will update its financial guidance for 2011 to include the acquisition of Access to Money following the completion of the transaction. In the interim, Cardtronics reiterates the guidance it previously provided in August.