8-KMaterial AgreementsFinancial EventsExhibits & Filings

FISERV INC 8-K Report, Material Agreement (Nov 20, 2007)

Filed November 20, 2007For Securities:FISV

Summary

Fiserv, Inc. (FISV) has filed an 8-K report detailing a significant debt financing transaction completed on November 20, 2007. The company successfully issued $1.25 billion in 6.125% Senior Notes due 2012 and $500 million in 6.8% Senior Notes due 2017, totaling $1.75 billion in aggregate principal amount. These notes are guaranteed by certain wholly-owned domestic subsidiaries. The proceeds from this issuance are likely intended to fund strategic initiatives, including the acquisition of CheckFree Corporation. The issuance includes specific provisions related to the CheckFree acquisition. If the acquisition does not close by August 1, 2008, or if the merger agreement is terminated, Fiserv is obligated to redeem these notes at a premium. Furthermore, the company is subject to a change of control provision requiring a repurchase offer if a triggering event occurs. The debt rating of the notes is also subject to adjustment based on changes in credit ratings.

Key Highlights

  • 1Fiserv, Inc. raised $1.75 billion in aggregate principal amount through the issuance of Senior Notes.
  • 2The notes comprise $1.25 billion of 6.125% Senior Notes due 2012 and $500 million of 6.8% Senior Notes due 2017.
  • 3The debt issuance is secured by guarantees from certain of Fiserv's wholly-owned domestic subsidiaries.
  • 4A key contingency for the debt issuance is the consummation of the acquisition of CheckFree Corporation by August 1, 2008; failure to do so triggers a mandatory redemption at 101% of principal.
  • 5The company may redeem the notes prior to maturity at a 'make-whole' price.
  • 6A change of control triggering event will require Fiserv to offer to repurchase the notes at 101% of their principal amount.
  • 7The interest rates on the notes are subject to adjustment based on credit rating changes by debt rating agencies.

Frequently Asked Questions

This Form 8-K filing announces the completion of a significant debt financing transaction by Fiserv, Inc. on November 20, 2007. It details the issuance of $1.75 billion in Senior Notes and outlines the terms, conditions, and certain contingent obligations associated with this debt.

While not explicitly stated as the sole purpose, the filing strongly implies that the proceeds are related to the planned acquisition of CheckFree Corporation. There are specific redemption clauses tied to the completion or termination of this acquisition.

Investors face risks related to the potential non-completion of the CheckFree acquisition, which could trigger a mandatory redemption. There's also a risk related to 'change of control' events and potential adjustments to interest rates based on credit rating downgrades. Additionally, the notes are senior unsecured obligations, meaning repayment priority is subject to secured debt obligations.

If Fiserv does not complete the acquisition of CheckFree by August 1, 2008, or if the merger agreement is terminated before then, Fiserv is required to redeem all outstanding notes at a redemption price of 101% of their aggregate principal amount, plus accrued interest.