Fidelity National Shares Drop 15.8% on Worldpay Spinoff News
14 February 2023 - 4:16AM
Dow Jones News
By Dean Seal
Shares of Fidelity National Information Services Inc. fell 15.8%
to a low of $63.51 in the first two hours of trading Monday after
the company said it would spin off the Worldpay merchant-solutions
business it acquired in 2019.
The financial-services-technology company said before the bell
Monday that it is planning to complete the spinoff of Worldpay
within the next 12 months and to have Charles Drucker, the former
chief executive of Worldpay, return to the helm of the separated
company.
Fidelity's board has concluded that a spinoff would improve the
performances of each business and unlock shareholder value as
disruption in the payments space drives the need for investments in
growth and a different capital allocation strategy at Worldpay,
Chairman Jeffrey A. Goldstein said.
The spinoff of Worldpay also would help Fidelity target a
stronger investment credit rating, Fidelity Chief Executive
Stephanie Ferris said.
Activist investor and Fidelity shareholder JANA Partners said
Monday that it supported the decision to spin off Worldpay. The
investment firm said in December that it had engaged with
management and stood behind Fidelity's decision to pursue a
strategic review that ultimately led to the Worldpay spinoff
plan.
"We welcome the decisive actions taken by the company and
believe separating the merchant business with Charles Drucker as
CEO, increasing savings targets, and aligning compensation with
performance are the right steps to unlock shareholder value," JANA
Managing Partner Scott Ostfeld said in a statement.
Fidelity's shares are down more than 42% over the past 12
months.
Write to Dean Seal at dean.seal@wsj.com
(END) Dow Jones Newswires
February 13, 2023 12:01 ET (17:01 GMT)
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