FNF to acquire F&G in $2.7bn insurance deal

BY Fraser Tennant

In a transaction valued at $2.7bn, the US’s largest provider of commercial and residential mortgage and diversified services, Fidelity National Finance (FNF) Inc, is to acquire FGL Holdings (F&G), a leading provider of fixed indexed annuities and life insurance.

Under the terms of the merger agreement, holders of F&G's ordinary shares (other than FNF and its subsidiaries) may elect to receive either $12.50 per share in cash or 0.2558 of a share of FNF common stock for each ordinary share of F&G they own. Upon closing of the transaction, F&G shareholders will own approximately 7 percent of the outstanding shares of FNF common stock.

The acquisition of F&G offers FNF entry to an industry that it expects will perform well in economic environments which are challenging for title insurance. “We are excited to announce our plans to acquire F&G Holdings and look forward to welcoming F&G employees and policyholders to the FNF family,” said William P. Foley, II, chairman of FNF. “The board and management diligently reviewed FNF's capital allocation strategy and determined that expanding into the annuity market through the acquisition of F&G Holdings would offer compelling benefit to our shareholders.”

Following the close of the transaction, which has been approved by a special committee of F&G directors, a special committee of FNF directors and the FNF board of directors, F&G will operate as a subsidiary of FNF. “We are pleased to join forces with FNF, a world-class company we know well and respect,” said Chris Blunt, president and chief executive of F&G. “This agreement, which offers immediate value to F&G shareholders and compelling benefits to our stakeholders, will provide a meaningful platform for our business as we continue to build the F&G of the future.”

The transaction is expected to close in the second or third quarter of 2020, subject to the satisfaction of customary closing conditions, including the receipt of regulatory clearances and approval by F&G shareholders.

Mr Blunt concluded: “We are excited to enter into the next phase of growth with FNF and are confident that by combining our complementary businesses, we will be better positioned to carry out our mission of helping customers turn their aspirations into reality.”

News: U.S. insurer Fidelity National to buy FGL Holdings in $2.7 billion deal

Worldline and Ingenico agree $8.7bn merger

BY Richard Summerfield

France’s two biggest payments companies are to merge after Worldline agreed to acquire rival Ingenico for $8.7bn.

The deal will see Ingenico shareholders receive 11 Worldline shares and €160.50 in cash for every seven Ingenico shares held—a 24 percent premium on Ingenico’s average share price over the last month. Pending regulatory and shareholder approvals, the deal is expected to close in Q3 2020. Under the terms of the deal, Gilles Grapinet, chairman and chief executive of Worldline, will lead the combined company.

“I am proud to announce that today is a great day for Worldline and for Ingenico, and more widely for our payment industry: together we create the European world-class leader in digital payments,” said Mr Grapinet. “We deeply respect Ingenico and its team for the deep business repositioning of their company realised over the last years into one of the largest European payment service providers with outstanding global positions in online payments and merchant acquiring. We have been impressed by the strong improvement in performance realised over the last 18 months under the leadership of Nicolas Huss, as well as by the in-depth transformation initiated at the same time of their global leading payment terminal business, resulting in increased efficiency, more autonomy and a new strategic roadmap.”

“The combination of Worldline and Ingenico offers a unique opportunity to create the undisputed European champion in payments on par with the largest international players,” said Bernard Bourigeaud, chairman of Ingenico. “This transaction comes at the time of accelerating consolidation of the industry and I am convinced that the joined forces of both leaders will deeply transform the industry. I am very pleased to write a new page in the European payment landscape and build the foundation of a strong and breakthrough payment player. This transaction is unanimously supported by Worldline and Ingenico’s board of directors and I would be very proud to become the non-executive chairman of the board of directors at closing to pursue this exceptional success story.”

The combined company will have 20,000 employees across 50 countries with 1 million merchant and 1200 financial institution customers. Worldline said it expects combined proforma 2019 net revenues of €5.3bn out of the deal.

News: Worldline's $8.7 billion Ingenico deal to create European payments leader

BorgWarner assimilates Delphi Technologies

BY Richard Summerfield

US auto parts manufacturer BorgWarner has agreed to acquire UK-based Delphi Technologies in a $3.3bn deal.

The deal will see Delphi stockholders receive a fixed exchange ratio of 0.4534 shares of BorgWarner common stock per Delphi Technologies share. That translates to $17.39 per share, a premium of around 77 percent to Delphi’s closing price on Monday.

Upon closing of the transaction, current BorgWarner stockholders are expected to own approximately 84 percent of the combined company, Delphi Technologies stockholders are expected to own approximately 16 percent. The deal is expected to close in the second half of 2020, pending shareholder and regulatory approval and customary closing conditions.

“This exciting transaction represents the next step in BorgWarner’s balanced propulsion strategy, strengthening our position in electrified propulsion as well as our combustion, commercial vehicle and aftermarket businesses,” said Frédéric Lissalde, president and chief executive of BorgWarner. “Delphi Technologies will bring proven leading power electronics technologies, talent and scale that will complement our hybrid and electric vehicle propulsion offerings. As a combined company, we look forward to delivering enhanced solutions to our customers while driving increased value for our stockholders.”

“This is a compelling transaction that we are confident delivers clear benefits to our stakeholders,” said Richard F. Dauch, chief executive of Delphi Technologies. “Delphi Technologies’ portfolio is highly complementary to BorgWarner’s, and together we plan to create a pioneering propulsion technologies company uniquely equipped to serve OEMs and aftermarket customers around the world. BorgWarner’s team shares our focus on addressing today’s and tomorrow’s challenges, and the combination will create exciting opportunities for our employees. We also expect our stockholders will benefit from the opportunity to participate in the future growth and upside potential of the combined company.”

The combined company will be led by Mr Lissalde and BorgWarner chief financial officer Kevin Nowlan and will operate as BorgWarner.  BorgWarner had sales of $10.17bn in fiscal 2019, while Delphi had sales of $4.36bn.

News: BorgWarner to buy Delphi Technologies in $3.3 billion auto parts deal

Far Point goes Global

BY Richard Summerfield

The blank cheque FinTech firm Far Point Acquisitions has agreed to acquire shopping tax refund company Global Blue in a $2.6bn deal. The deal is expected to close in the second quarter of 2020.

Far Point’s majority owner, private equity investor Silver Lake, will retain around 42 percent of the combined company, according to a statement announcing the deal. Under the terms of the deal, Far Point will invest $650m in cash, while Ant Financial and Third Point have agreed to invest a total of $350m in the newly combined company.

Far Point is a special purpose acquisition company (SPAC) established by hedge fund Third Point LLC and ex-New York Stock Exchange president Thomas Farley. Going forward, Global Blue’s chief executive Jacques Stern will continue to lead the combined company, and Mr Farley will become chairman of the firm.

“Global Blue is the clear market leader in the attractive and growing Tax Free Shopping ecosystem worldwide,” said Mr Farley. “The company has achieved remarkable progress in digitalization, geographic expansion and strategic value creation under Jacques’ leadership and the stewardship of its existing shareholders, including controlling shareholder Silver Lake, whose principals I have known personally and professionally for years. I look forward to working with Global Blue to capitalize on favorable trends in the business, including the growth of the emerging markets middle-class, positive VAT dynamics, and further digitalization.”

“I am delighted about this collaboration with Far Point and Tom, as I believe it will help create long-term value for Global Blue and its shareholders,” said Mr Stern. “In recent years, we have built a true leader in our industry, powered by a cutting-edge integrated technology platform. We strongly believe that continued investment in innovation will bring value to all our partners and customers, and we look forward to accelerating our strategic collaboration with Ant Financial as a showcase of such innovation.”

The new public company will be incorporated in Switzerland and will trade as Global Blue upon closing.

News: Far Point to buy tax-free shopping firm Global Blue at $2.6 billion valuation

Visa make $5.3bn FinTech bet

BY Richard Summerfield

Payments giant Visa Inc has agreed to acquire FinTech start-up Plaid Inc in a deal worth $5.3bn. The deal is expected to close in the next three to six months, pending regulatory approval and customary closing conditions.

In late 2018, Visa and rival Mastercard both made “strategic investments” in Plaid as part of a $250m Series C funding round which valued the company at $2.65bn. A little over a year later, Visa has returned to acquire the rest of the company.

Plaid develops financial services application programming interfaces (APIs) and helps developers share banking and other financial information more easily and thus is a logical target for Visa. Since launching in 2013, the company has begun to work with over 11,000 financial institutions across the US, Canada and Europe and connects to more than 200 million consumer accounts. Plaid’s software enables providers of financial technology to connect to the bank accounts of their customers.

Visa said it will fund the deal using cash on hand as well as debt that will be issued at a later date. The acquisition will not impact upon Visa’s previously announced stock buyback or dividend plans.

“We are extremely excited about our acquisition of Plaid and how it enhances the growth trajectory of our business,” said Al Kelly, chief executive and chairman of Visa. “Plaid is a leader in the fast growing fintech world with best-in-class capabilities and talent. The acquisition, combined with our many fintech efforts already underway, will position Visa to deliver even more value for developers, financial institutions and consumers.”

“Plaid’s mission is to make money easier for everyone, and we are excited for this opportunity to continue delivering on that promise at a global scale,” said Zach Perret, chief executive and co-founder of Plaid. “Visa is trusted by billions of consumers, businesses and financial institutions as a key part of the financial ecosystem, and together Visa and Plaid can support the rapid growth of digital financial services.”

News: Visa to pay $5.3 billion to buy fintech startup Plaid