Financial technology corporation, Fidelity National Information Services (FIS), is making financial arrangements in preparation for the separation from its subsidiary, Worldpay. The company’s board has announced a plan to distribute about 19.9% of Worldpay’s outstanding common stock as a pro-rata dividend to FIS shareholders.
Following regulatory and shareholder approvals, FIS is expected to execute the distribution on December 1, 2021. This strategic move aims to create two standalone, publicly traded companies that can better focus on their respective markets and operations.
As part of the separation agreement, FIS will not retain any ownership interest in Worldpay. The successful closing of this transaction will mark the final step in a series of transformative actions that FIS has undertaken to enhance its capital structure and optimize business performance.
Worldpay, a leading provider of payment processing solutions, was originally acquired by FIS in July 2019. This acquisition enabled FIS to expand its capabilities in the global payments industry and unlock new growth opportunities. However, after careful evaluation, FIS has decided that a separation is in the best interest of both companies and their shareholders.
“The planned separation of Worldpay reflects our commitment to reshape FIS and optimize our portfolio,” said Gary Norcross, Chairman and CEO of FIS. “We believe this separation will allow both companies to sharpen their focus, capitalize on their strengths, and drive innovation in their respective markets.”
Read more: FIS Announces Plan to Separate Worldpay Inc.
FIS anticipates that the independent companies will benefit from greater strategic flexibility and a refined growth trajectory. Worldpay will be well-positioned to leverage its industry-leading capabilities in digital payments and merchant acquiring. On the other hand, FIS will continue to focus on delivering innovative and comprehensive technology solutions that drive financial institutions’ digital transformations.
This separation demonstrates FIS’s commitment to adapt and thrive in an ever-evolving financial landscape. By streamlining its operations, FIS aims to ensure improved agility, customer-centricity, and market competitiveness. The move aligns with the company’s long-term strategy of pursuing sustainable growth and delivering value to shareholders.
With the distribution of Worldpay’s common stock, FIS shareholders will hold a direct stake in both entities and have the opportunity to participate in their future success. This separation also opens avenues for potential strategic partnerships, acquisitions, or investment opportunities to accelerate the growth of each entity independently.
As the financial industry continues to witness rapid digital transformation, the separation of FIS and Worldpay positions both companies to address the unique challenges and opportunities in their respective domains. The transaction marks a significant milestone in their histories and represents a strategic shift towards unlocking even greater value for shareholders.
The financial community eagerly awaits the completion of this separation, which promises to shape the future of FIS and Worldpay as independent powerhouses within the global payments ecosystem. Exciting times lie ahead as both companies venture forward to capitalize on their individual strengths and make their mark in the ever-evolving financial technology landscape.