Summary
Certegy Inc. announced on May 23, 2005, that it has entered into an agreement to sell its merchant acquiring business to NOVA Information Systems. This divestiture is a significant strategic move, as Certegy's merchant acquiring portfolio generates approximately $4.5 billion in annual volume. The transaction includes the sale of a substantial portion of this business, with plans to sell the remaining portfolio volume in the near future. Investors should note the expected financial impact of these dispositions. Certegy anticipates receiving after-tax proceeds in the range of $42 million to $44 million and is projecting a net after-tax gain of approximately $16 million to $17 million, which translates to $0.25 to $0.27 per diluted share. The completion of the sale to NOVA is contingent upon receiving the necessary regulatory approvals.
Key Highlights
- 1Certegy Inc. agrees to sell its merchant acquiring business to NOVA Information Systems.
- 2The merchant acquiring portfolio generates approximately $4.5 billion in annual transaction volume.
- 3The transaction includes the sale of a significant portion of the merchant acquiring business, with the remainder to be sold separately.
- 4Certegy expects to receive $42-$44 million in after-tax proceeds from the dispositions.
- 5A net after-tax gain of $16-$17 million (or $0.25-$0.27 per diluted share) is projected.
- 6The sale is subject to required regulatory approvals.