An agreement to offer payment and software services to over 1,300 financial institutions and 3.5 million merchants is underway as Global Payments and Total System merge in a $21.5 billion deal.
Under the agreement, Total System Services (TSYS) shareholders will receive 0.8101 of Global Payment shares they own, valued at $119.86 apiece.
Shareholders of Global Payments will have a 52% stake in the merger while TSYS shareholders will own 48%. Jeff Sloan, Global Payments CEO, will head the merger. Troy Woods, CEO of Total System, will become chairman of the combined services company.
Global Payments, which is based in Atlanta, is a software and payment technology provider while Columbus-based TSYS provides merchant services, payment processing and issuing to institutions in the financial and non-financial sectors. Designed to provide payment and software services to merchants and financial institutions across over 100 countries, the companies expect the deal to assist payment companies offer integrated merchant, consumer segment and issuing services.
As reported in CNBC, Bank of America is playing a big role in Global Payments’ quest to buy TSYS. The deal closely follows the announcement by FIS’ for the purchase of Worldpay for roughly $35 billion. A similar deal was also brokered in January when Fiserv announced its $22 billion deal for the acquisition of First Data.
All of these deals have a common theme: there is an ultimate goal to provide ‘one-stop shops’ for any number of devices, software and services for companies that offer merchants the ability to provide consumers with a range of payment choices. According to Global Payments, this latest deal will expand its e-commerce presence in the United States as well as boost its market share. The companies believe that by offering customer-oriented segments, it will gain a strong hold on digital payment trends.
This deal is proof of the increasing competition among financial companies. In fact, only a year ago, TSYS acquired Cayan for $1 billion, in a deal which, according to the senior executive vice president and president of TSYS, Philip McHugh, spells the rapid evolution TSYS were making in merchant services.
Global Payments’ interest in merchant account acquiring has now made the company the third-largest player in the industry. The acquisition of TSYS, another company with global reach, is good news indeed for the payments industry.
About The Author
Mark Sands, co-founder of High Risk Merchant Account LLC, an authoritative expert in the high risk merchant account space. Mark has decades of experience in the payment industry & enjoys writing on entrepreneurial related topics.