First Data Corp. has filed paperwork with the U.S. Securities & Exchange Commission (SEC) to conduct its initial public offering (IPO). First Data is one of the top sector players in the global commerce and e-commerce business. The company is now owned by private equity, with KKR & Co. LP (NYSE: KKR) and its affiliates holding some 74% of the company via an entity called New Omaha Holdings LP.
What matters here is that First Data was one of the largest and late buyouts during the private equity boom before the recession. KKR announced its acquisition for some $25.6 billion back in 2007.
No details have been announced in the filing other than that the filing will be for up to $100 million. Needless to say, that number may just be for filing purposes and can be greatly higher or lower when the formal IPO launches – likely much higher than just $100 million.
While this is potentially a very large IPO, no formal pricing terms were set. Also missing was whether First Data would list on the New York Stock Exchange or on the Nasdaq, and its proposed ticker was not disclosed either. First Data used trade under the ticker FDC on the New York Stock Exchange.
Reports were out in 2014 that KKR was leading another $3 billion or higher investment into the company.
The company’s filing showed that it will have two classes of common stock via the Class A common shares and Class B shares. The rights of the holders of Class A common stock and Class B common stock will be identical, except with respect to voting, conversion, and transfer restrictions applicable to the Class B common stock: class A shares gets one vote and Class B shares will get ten votes (and will be convertible at any time into one share of Class A common stock).
First Data said about itself in its IPO filing:
We serve our clients in 118 countries, reaching approximately 6 million business locations and over 4,000 financial institutions. We believe we have the industry’s largest distribution network, driven by our partnerships with many of the world’s leading financial institutions, our direct sales force, and a network of distribution partners. We are the largest merchant acquirer, issuer processor, and independent network services provider in the world, enabling businesses to accept electronic payments, helping financial institutions issue credit, debit and prepaid cards, and routing secure transactions between them. In 2014, we processed 74 billion transactions globally, or over 2,300 per second, and processed 28% of the world’s eCommerce volume. In our largest market, the United States, we acquired $1.7 trillion of payment volume, accounting for nearly 10% of U.S. GDP last year.
In 2014, we generated $11.2 billion of revenue, $1.4 billion of operating profit, and had a net loss attributable to First Data of $458 million, reflecting an increase of 3%, 28% and 47% (decrease of loss), respectively, over 2013. For the same period, we generated segment revenues (which exclude reimbursable fees and other items) of $6.9 billion, Adjusted EBITDA of $2.7 billion, and Adjusted Net Income of $409 million, reflecting an increase of 3%, 9% and 354%, respectively, over 2013.
Here is an infographic from the First Data IPO filing: