- Vantiv and Worldpay, the U.K's largest payment processing firm, have agreed on a merger worth £7.7 billion ($9.94 billion).
- Worldpay shareholders to get £3.85 per share.
- After the potential merger, Worldpay shareholders would own approximately 41 percent of the share capital of the newly-combined group.
Worldpay shareholders are entitled to 55 pence in cash for each Worldpay share and 0.0672 new Vantiv shares. This would mean ultimately shareholders of Worldpay would get £3.85 per share. That is made up of a 5 pence dividend, plus the Vantiv shares based on a closing price of $62.51 on July 3.
The merger terms represent around an 18.9 percent premium to Worldpay's closing share price in London on July 3, a day before the payments firm announced that it had been approached for an acquisition separately by both Vantiv and JPMorgan Chase.
Shares in the British firm slumped over 10 percent after JPMorgan said it does not intend to make an offer for Worldpay.
"In response to an invitation from Worldpay, JPMorgan was at a very early stage in considering whether or not to make an offer or the terms of any offer for Worldpay. Following preliminary considerations, JPMorgan hereby announces that it does not intend to make an offer for Worldpay," the bank said in a statement.
Following the potential merger, Worldpay shareholders would own approximately 41 percent of the share capital of the newly combined group.
"The potential merger creates a scale world class payments group in a dynamic market, with deep payments capabilities, product and vertical expertise and strong distribution channels to serve merchants around the world in the global e-commerce market, and in-store and online in the U.K. and U.S. markets," the companies said in a statement.
Both boards have identified "substantial opportunities for cost synergies, which support significant potential shareholder value creation", adding that there would be "additional revenue growth" opportunities too.
The combined group will be led by Vantiv Chief Executive Charles Drucker as executive chairman and co-CEO. Current Worldpay CEO Philip Jansen will be co-CEO of the joint group. Vantiv Chief Financial Officer Stephanie Ferris, will remain CFO of the combined group. The board will consist of four Worldpay and seven Vantiv directors.
Following the completion of the potential merger, Worldpay shares will be delisted from the London Stock Exchange, while common stock of Vantiv will be held by the combined group and continue to be listed on the New York Stock Exchange.
Completion of the merger is subject to shareholder approval.
Vantiv shares were halted premarket.