8-KMaterial AgreementsFinancial EventsOther Events+1

FISERV INC 8-K Report, Material Agreement (Jun 24, 2019)

Filed June 24, 2019For Securities:FISV

Summary

Fiserv, Inc. (FISV) announced the successful closing of a substantial public offering of senior notes totaling $9 billion on June 24, 2019. This offering comprises four tranches of notes with varying maturities and interest rates: $2 billion in 2.750% Senior Notes due 2024, $2 billion in 3.200% Senior Notes due 2026, $3 billion in 3.500% Senior Notes due 2029, and $2 billion in 4.400% Senior Notes due 2049. These notes are governed by an indenture and supplemental indentures specific to each issuance, with terms outlining interest payments, maturity dates, optional redemption clauses, and significant provisions related to change of control and special mandatory redemption tied to the company's proposed merger with First Data. This large debt issuance is a significant financial event for Fiserv, likely aimed at funding its strategic initiatives, including the previously announced merger with First Data Corporation. Investors should note the specific terms for redemption and the potential for a mandatory repurchase of all outstanding notes at 101% of their principal amount plus accrued interest should the First Data merger not be consummated by a specified date (April 16, 2020, or an extended date). The company also highlighted that these notes are registered under a Form S-3 Registration Statement, indicating their public market availability and compliance with relevant securities regulations.

Key Highlights

  • 1Fiserv, Inc. successfully closed a public offering of $9 billion in aggregate principal amount of senior notes on June 24, 2019.
  • 2The offering is comprised of four series of notes: $2B (2.750% due 2024), $2B (3.200% due 2026), $3B (3.500% due 2029), and $2B (4.400% due 2049).
  • 3The notes carry varying interest rates and maturity dates, reflecting different terms for long-term financing.
  • 4A key provision includes a mandatory repurchase of all notes at 101% of principal plus accrued interest if the proposed merger with First Data Corporation is not consummated by April 16, 2020 (or an agreed-upon extension).
  • 5The company retains the option to redeem the notes early, with redemption prices varying based on the proximity to the maturity date.
  • 6These new debt obligations are formalised through various supplemental indentures filed as exhibits to the 8-K.
  • 7The notes are registered under a Form S-3 Registration Statement, facilitating their public trading.

Frequently Asked Questions

Fiserv, Inc. raised a total of $9,000,000,000 (nine billion U.S. dollars) in aggregate principal amount through the issuance of its senior notes.

The offering includes: $2,000,000,000 of 2.750% Senior Notes due 2024, $2,000,000,000 of 3.200% Senior Notes due 2026, $3,000,000,000 of 3.500% Senior Notes due 2029, and $2,000,000,000 of 4.400% Senior Notes due 2049.

Fiserv is required to offer to repurchase all outstanding notes at 101% of the aggregate principal amount plus accrued interest if the proposed merger with First Data Corporation is not consummated by April 16, 2020 (or a later extended date), or if the merger agreement is terminated before then without consummation of the merger.

While not explicitly stated in this filing, large debt issuances of this nature typically fund significant strategic initiatives, such as acquisitions or major capital expenditures. Given the timing, it is highly probable that this issuance is related to funding the previously announced merger with First Data Corporation.