Fidelity National Services: Paying Up For Deals With Global Payments

2025-04-18 03:21:51 ET

Summary

• Fidelity National Services sold its remaining Worldpay shares at a premium to book value, but a loss compared to the original purchase, simplifying its business.
• The company simultaneously announced a $13.5 billion acquisition of Global Payments' Issuer Solutions and a $6.6 billion deal to sell it a minority stake in Worldpay.
• Despite positive market reactions, increased debt and complex transactions make me cautious about FIS shares, which have risen 10% to $75.
• The deals simplify FIS's business but create short-term uncertainties, making it prudent to avoid chasing the stock despite the positive outlook.

In the summer of 2023, I believed that Fidelity National Information Services ( FIS ) had seen a very painful roundtrip transaction for Worldpay. The company sold a majority stake in Worldpay at a huge discount compared to the purchase price, which it paid in 2019....

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