8-KOther Events

GLOBAL PAYMENTS INC 8-K Report (Aug 12, 2003)

Filed August 12, 2003For Securities:GPN

Summary

GLOBAL PAYMENTS INC. (GPN) announced on August 11, 2003, a significant strategic acquisition of Latin America Money Services, LLC (LAMS), the holding company for DolEx Dollar Express, Inc. (DolEx). This transaction, valued at approximately $190 million plus a potential $10 million earn-out, will expand GPN's presence in the lucrative consumer-to-consumer electronic money transfer market, particularly within the Latino community. DolEx, founded in 1996, is a leading provider of remittance services, enabling individuals in the U.S. to send money to Latin America. The acquisition is expected to be financed through GPN's existing credit facilities and cash reserves, with the deal anticipated to close by the end of 2003, subject to regulatory approvals. This move represents a substantial step for Global Payments in broadening its service offerings and geographic reach in a growing sector.

Key Highlights

  • 1Global Payments Inc. to acquire Latin America Money Services, LLC (LAMS), parent of DolEx Dollar Express, Inc.
  • 2Acquisition price of $190 million plus up to $10 million in contingent payment based on 2003 DolEx results.
  • 3DolEx is a leading provider of consumer-to-consumer electronic money transfer services to the Latino community.
  • 4Transaction diversifies GPN's service offerings into the remittance market.
  • 5Acquisition expected to be financed through existing credit line, cash, and notes payable.
  • 6Deal is subject to regulatory approvals and expected to close before the end of 2003.
  • 7DolEx reported $69.9 million in total revenues for the fiscal year ended December 31, 2002.

Frequently Asked Questions

The acquisition of DolEx Dollar Express, Inc. allows Global Payments Inc. to enter and expand its presence in the growing consumer-to-consumer electronic money transfer market, particularly targeting the significant Latino community in the U.S. and their families in Latin America. This diversification aims to broaden the company's service portfolio and revenue streams.

The company expects to finance the purchase price of approximately $190 million, plus a potential contingent payment, through a combination of its existing line of credit, cash on hand, and notes payable. This suggests the company has sufficient financial flexibility to complete the transaction.

The acquisition is subject to regulatory approvals. Global Payments Inc. anticipates that the transaction will close before the end of 2003. Investors should monitor future filings for confirmation of regulatory clearance and closing.

For the fiscal year ended December 31, 2002, DolEx and its subsidiary reported total revenues of $69.9 million. This acquisition will add a revenue stream of nearly $70 million to Global Payments, demonstrating a substantial expansion of its business operations.