Banking, finance, and taxes
Is Global Payments Paying Too Much for Heartland?
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Global Payments Inc. (NYSE: GPN) and Heartland Payment Systems Inc. (NYSE: HPY) are balancing each other out in terms of their losses and gains on the day, on news of a merger. Global Payments announced that it has entered into a definitive agreement to acquire Heartland Payment to the tune of a cash-and-stock transaction for $100 per share, or approximately $4.3 billion.
Specifically, consideration for the transaction will consist of 0.6687 shares of Global Payments stock and $53.28 for each share of Heartland stock at closing, subject to the terms of the merger agreement.
Global Payments expects to realize at least $50 million in synergies in fiscal 2017 and approximately $125 million of annual run-rate synergies thereafter.
Thomson Reuters estimates Heartland’s revenue for the 2015 full year to be roughly $820 million, while the 2016 expected revenue is estimated at nearly $900 million.
The transaction is still subject to shareholder and regulatory approval, but both companies expect it to close by halfway through the 2016 calendar year.
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