Blackstone Fidelity National
Blackstone Group Buyout of Fidelity National Falls Throughrumored buyout of Fidelity National Information Services (FIS) and now it appears that the deal has fallen through. The consortium of private equity firms led by Blackstone Group LP (BX) scrapped its plan a buyout of Fidelity National, reportedly because the parties could not agree on a price. Now, Fidelity has said that discussions of the buyout have stopped and the company will be attempting a leveraged recapitalization with a large buyback of shares.
A consortium led by Blackstone Group LP (BX) dropped its plan to acquire the financial-data processor late Monday over a disagreement in price, a person familiar with the situation told The Wall Street Journal. The company confirmed Tuesday morning the discussions had ceased and said it would pursue a leveraged recapitalization with a "substantial" share repurchase.Read about the rumored Fidelity National buyout by Blackstone
Fidelity National's shares were recently off 5.2% to $27.37. The stock is up 17% so far this year and 46% in the last 12 months.
Robert W. Baird analyst David Koning acknowledged the recapitalization will add to Fidelity National's debt load but said similar companies have been able to support three times debt to Ebitda, and though Fidelity National has about $3.1 billion in total debt, that's just 2.1 times debt to trailing Ebitda.
Of course, there's also the possibility other bidders may emerge for Fidelity National, though it's unclear whether a private-equity deal or a purchase by a peer would be more likely. Source