8-KAcquisitions & DispositionsMaterial AgreementsRegulation FD+1

EQUIFAX INC 8-K Report, Agreement Terminated (Dec 28, 2012)

Filed December 28, 2012For Securities:EFX

Summary

Equifax Inc. (EFX) announced the completion of a significant acquisition on December 28, 2012, purchasing certain credit services business assets and operations from Computer Sciences Corporation (CSC) for approximately $1.0 billion in cash. This strategic move was funded through a combination of senior notes, commercial paper, and existing cash reserves, indicating a substantial investment in expanding its market presence. The acquisition also resulted in the termination of a long-standing agreement, dated August 1, 1988, under which Equifax provided computerized credit database services to CSC's credit reporting agencies. This termination effectively ends the prior revenue-sharing arrangement where Equifax received processing fees while CSC retained ownership of its credit files and associated revenues. This transaction represents a major strategic shift for Equifax, moving from a service provider role under the old agreement to a direct acquirer of CSC's credit reporting assets. Investors should note the significant capital deployment and the integration of a new business segment into Equifax's operations. The accompanying press release and previously filed financial statements (both of the acquired CSC business and pro forma combined financials) provide further detail on the transaction's financial implications. The termination of the prior agreement, while a consequence of the acquisition, signifies the end of a historical business relationship and a clear step towards consolidating CSC's credit reporting activities under Equifax's ownership.

Key Highlights

  • 1Equifax Inc. completed the acquisition of certain credit services business assets and operations from Computer Sciences Corporation (CSC) on December 28, 2012.
  • 2The acquisition cost approximately $1.0 billion in cash.
  • 3The purchase was funded through a mix of Senior Notes (3.30% due 2022), commercial paper, and available cash.
  • 4The transaction's completion terminated a material definitive agreement dated August 1, 1988, related to computerized credit reporting services provided by Equifax to CSC.
  • 5Under the terminated agreement, Equifax received processing fees while CSC owned the credit files and revenues.
  • 6The acquisition signifies Equifax taking direct ownership and control of CSC's credit reporting business assets.
  • 7Financial statements of the acquired business and pro forma combined financial information have been previously filed and incorporated by reference.

Frequently Asked Questions

This 8-K filing primarily announces the completion of Equifax Inc.'s acquisition of certain credit services business assets and operations from Computer Sciences Corporation (CSC) on December 28, 2012, and the subsequent termination of a material definitive agreement between the two companies.

Equifax funded the $1.0 billion acquisition through approximately $496 million from the net proceeds of its 3.30% Senior Notes due 2022, $265 million from the issuance of short-term commercial paper, and $239 million from its other available cash reserves.

The termination of the August 1, 1988, agreement signifies the end of a long-standing service arrangement where Equifax provided credit database services to CSC. Under that agreement, Equifax earned processing fees, while CSC retained ownership of its credit files and related revenues. The acquisition by Equifax means it is now directly acquiring CSC's business, rather than servicing it.

Detailed financial information, including audited and unaudited financial statements of the acquired CSC Credit Services, Inc. business, and Equifax's unaudited pro forma condensed combined financial information, were previously filed by Equifax in an 8-K on December 10, 2012, and are incorporated by reference in this filing.