Fidelity National shares jump on buyout talk

The stock soars after The Wall Street Journal says Blackstone is in talks to take the credit card processor private. A deal might be worth $11 billion.

By Charley Blaine May 6, 2010 1:11PM
Updated: 1:35 p.m. ET.

For a couple of days, Wall Street has been abuzz that a big buyout -- a deal worth $10 billion or more -- was coming.

Today, names were put to the rumors: Blackstone (BX) would be the acquirer, The Wall Street Journal said, with Fidelity National Information Services (FIS) the target.
Blackstone and a group of investors were in talks with Fidelity National, the Journal said. Assuming the two sides agree on price and terms, it would be the biggest leveraged buyout since the credit crisis erupted in 2007.

Fidelity National shares jumped 15.8% to $30.04 on the news, which would suggest a market capitalization of more than $11 billion. The stock's jump was abrupt in the extreme. At 11:55 a.m. ET, the shares were at $25.80, down 0.8%. The news broke in the next few minutes, and at noon, the shares were at $29.92.

But Blackstone investors were more skeptical. The company is organized as a master limited partnership. The partnership units were down 5.1% to $12.62.

Fidelity National, headquartered in Jacksonville, Fla., processes credit card transactions, services auto loans and provides back-office services to money-management firms. It has been around since the late 1960s but public only since 2001.

The company earned $101 million, or 42 cents a share, on revenue of $3.77 billion in 2009, down from $109.9 million, or 57 cents, on revenue of $3.43 billion in 2008. Fidelity National Information Services

The stock peaked at $31.58 in July 2007 and bottomed at $12.47 in October 2008. It was up 11% for the year as of Wednesday's close.

It also has about $3 billion in debt.

It is NOT Fidelity Investments, the mutual fund company based in Boston.

Blackstone went public at $38 in 2007 as the stock market was peaking and has been a disappointment for investors ever since. Its unit price collapsed in the stock market crash, bottoming at $3.87 on Feb. 26, 2009. It finished 2009 at $13.12.

The jump in Fidelity National shares also pushed shares of competitor Fiserv (FISV) up 7.3% to $54.66. Other competitors include Accenture (ACN) and Total System Services (TSS). Both stocks were little changed today.
Please help us to maintain a healthy and vibrant community by reporting any illegal or inappropriate behavior. If you believe a message violates theCode of Conductplease use this form to notify the moderators. They will investigate your report and take appropriate action. If necessary, they report all illegal activity to the proper authorities.
100 character limit
Are you sure you want to delete this comment?


Copyright © 2014 Microsoft. All rights reserved.

Fundamental company data and historical chart data provided by Morningstar Inc. Real-time index quotes and delayed quotes supplied by Morningstar Inc. Quotes delayed by up to 15 minutes, except where indicated otherwise. Fund summary, fund performance and dividend data provided by Morningstar Inc. Analyst recommendations provided by Zacks Investment Research. StockScouter data provided by Verus Analytics. IPO data provided by Hoover's Inc. Index membership data provided by Morningstar Inc.



Quotes delayed at least 15 min
Sponsored by:


There’s a problem getting this information right now. Please try again later.
There’s a problem getting this information right now. Please try again later.
Market index data delayed by 15 minutes

[BRIEFING.COM] Equity indices closed out the month of August on a modestly higher note. The Russell 2000 (+0.6%) and Nasdaq Composite (+0.5%) finished ahead of the S&P 500 (+0.3%), which extended its August gain to 3.8%. Blue chips lagged with the Dow Jones Industrial Average (+0.1%) spending the bulk of the session in the red.

The final week of August represented one of the quietest stretches for the stock market so far this year. The first four sessions of the week produced the ... More


There’s a problem getting this information right now. Please try again later.
Sponsored by: