FIS, a banking and payment solutions provider, has announced its intent to spin off its Merchant Solutions Business, “Worldpay,” almost four years after acquiring it for USD 43 billion (in March 2019). FIS expects the spinoff to be completed within 12 months. FIS shareholders will receive a pro-rata distribution of Worldpay stock.
Charles Drucker, former Worldpay CEO, is appointed as a strategic advisor for the spinoff process and is expected to serve as the CEO of Worldpay if the spinoff is completed.
In 2022, Worldpay reportedly handled USD 2 trillion in payments across e-commerce, enterprise, and SMB users. Its revenue amounted to USD 4.8 billion, with an adjusted EBITDA margin of around 48%.
Following the spinoff, Worldpay may look to pursue more aggressive investment opportunities, such as M&As to expand geographic coverage, further develop their omnichannel experiences, and improve solutions for integrated software vendors (ISVs) to embed finance capabilities.
Analyst QuickTake: The spinoff comes at a time when the FinTech infrastructure industry has seen a period of consolidation. Within the last six months, there have been several acquisitions, including Marqeta acquiring Power Finance , Flutterwave entering the running to acquire Railsr, and Zuora acquiring Zephr .
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