TORONTO, Dec. 23,
2024 /CNW/ - Payfare Inc. ("Payfare" or
the "Company") (TSX: PAY) (OTCQX: PYFRF), a leading
international Earned Wage Access ("EWA") company powering
instant access to earnings and digital banking solutions for
workforces, is pleased to announce that it has entered into a
definitive arrangement agreement (the "Arrangement
Agreement") with 1517452 B.C.
Ltd. the "Purchaser"), an affiliate of Fiserv, Inc. (NYSE:
FI) "Fiserv") a leading global provider of payments and
financial services technology, whereby the Purchaser will acquire
the Company, subject to obtaining shareholder and other customary
approvals (the "Transaction"). Under the terms of the
Arrangement Agreement, the Purchaser will acquire all of the issued
and outstanding common shares of the Company for CA$4.00 in cash
per share (the "Purchase Price"), for total consideration of
approximately CA$201.5 million.
The Purchase Price represents a premium of approximately 90% to
the closing price on the Toronto Stock Exchange (the "TSX")
of the common shares on December 20,
2024, the last trading day prior to the announcement of the
Transaction, and a premium of approximately 92% to the 60-day
volume weighted average trading price of common shares as at that
date.
"Our Board conducted a thorough strategic review process
together with our financial advisors, having evaluated numerous
acquisition, commercial partnership, and other opportunities, and
concluded that the Transaction is in the best interests of the
Company, its various stakeholders and its shareholders with
certainty of value with an all-cash offer," said Marco Margiotta, Payfare CEO, and Founding
Partner. "This Transaction represents tangible recognition of the
value and strength of what Payfare has built as we embark on this
exciting new chapter."
"Payfare has built a reputation as an innovator in workforce
payments for gig-economy companies," said Frank Bisignano, Chairman, President and Chief
Executive Officer of Fiserv. "Together, we can accelerate the
delivery of embedded finance solutions for all of our clients,
empowering their next chapter of success. We look forward to
welcoming the talented Payfare team to Fiserv."
Transaction Details
The Company's board of directors (with conflicted directors
abstaining) (the "Board"), after receiving the unanimous
recommendation of a committee of independent directors (the
"Special Committee"), has unanimously determined that the
Transaction is in the best interests of the Company. The
Arrangement Agreement was the result of a comprehensive negotiation
process that was undertaken with the oversight and participation of
the Special Committee advised by legal and independent financial
advisors.
The Transaction will be implemented by way of a court-approved
plan of arrangement under the Business Corporations Act
(British Columbia) and will
require the approval of 66 2/3% of the votes cast by shareholders,
and, in accordance with Multilateral Instrument 61-101 –
Protection of Minority Security Holders in Special
Transactions ("MI 61-101"), the approval of a majority
of votes cast by shareholders, excluding certain directors and
officers, at a special meeting of shareholders of the Company. In
addition, the Transaction is subject to the receipt of court
approval, certain third-party approvals, and other customary
closing conditions for transactions of this nature.
The Arrangement Agreement includes customary non-solicitation
provisions applicable to the Company and provides for the payment
of an approximately CA$10 million termination fee to the Purchaser
if the Transaction is terminated in certain circumstances. The
Arrangement Agreement also provides for reimbursement of the
expenses of the Purchaser in certain circumstances.
The Company intends to hold a special meeting of its
shareholders (the "Shareholders' Meeting"), where the
Transaction will be considered and voted upon by shareholders of
record.
The Transaction is not subject to a financing condition and is
expected to close in the first half of 2025. Upon closing of the
Transaction, the Purchaser intends to cause the issued and
outstanding shares of the Company to cease to be listed on the TSX
and the OTCQX, and to cause the Company to submit an application to
cease to be a reporting issuer under applicable Canadian securities
laws.
In addition, all of the directors and senior officers of the
Company have entered into voting support agreements, pursuant to
which they have agreed to, among other things, vote in favour of
the Transaction.
Unanimous Board Approval
The Board, upon the recommendation of the Special Committee,
unanimously recommends that shareholders of the Company vote in
favour of the Transaction. In making its determination to
unanimously recommend approval of the Transaction to the Board, the
Special Committee, and in the Board's determination to approve the
Transaction and recommend that shareholders of the Company vote in
favour of the Transaction, considered, among other things, the
following reasons for the Transaction:
- Significant Premium – the Purchase Price represents
a premium of approximately 90% to the closing price on the TSX of
the common shares on December 20,
2024, the last trading day prior to the announcement of the
Transaction, and a premium of approximately 92% to the 60-day
volume weighted average trading price of common shares as at that
date;
- Strategic Review Process – subsequent to the press
release disseminated September 29,
2024 announcing the initiation of a strategic review
process, the Company, with the assistance of its financial advisor
Keefe, Bruyette, & Woods Inc. ("KBW"), evaluated several
acquisition, commercial partnership, and sale opportunities, that
did not result in any proposal that was superior to the
Transaction;
- Fairness Opinions – the Special Committee received a
fairness opinion from Blair Franklin Capital Partners Inc.
("Blair Franklin"), acting as
independent financial advisor to the Special Committee, and the
Board received a fairness opinion from KBW, each concluding that,
based upon and subject to the assumptions, limitations and
qualifications set out in their respective opinions, the
consideration to be received by shareholders pursuant to the
Transaction is fair, from a financial point of view, to
shareholders;
- Arrangement Agreement Terms – the Arrangement Agreement
is the result of a comprehensive negotiation process that was
undertaken at arm's length with the oversight and participation of
the Special Committee;
- All-Cash Consideration – the all-cash consideration
provides shareholders with certainty of value;
- Minority Vote and Court Approval – the Transaction must
be approved by two-thirds of the votes cast by shareholders of the
Company and by a majority of shareholders of the Company, excluding
certain directors and officers, in accordance with MI 61-101, and
by the Supreme Court of British
Columbia; and
- Support for the Transaction – all of the directors and
senior officers of the Company have entered into voting support
agreements, pursuant to which they have agreed to, among other
things, vote in favour of the Transaction at the Shareholders'
Meeting, unless the Arrangement Agreement is terminated. The Shares
represented by the parties to the voting support agreements
represent approximately 11.3% of the issued and outstanding shares
of the Company.
Opinions
In connection with their review and consideration of the
Transaction, the Company engaged KBW as its financial advisor, and
the Special Committee engaged Blair
Franklin as its independent financial advisor in respect of
the Transaction. KBW provided an opinion to the Board, and
Blair Franklin provided an opinion
to the Special Committee that, based upon and subject to the
assumptions, limitations and qualifications set out in their
respective opinions, the consideration to be received by
shareholders pursuant to the Transaction is fair, from a financial
point of view, to shareholders.
Filings and Proxy Materials
Further information regarding the Transaction, the Arrangement
Agreement and the Shareholders' Meeting, including a copy of
Blair Franklin's and KBW's fairness
opinions, will be included in the management information circular
expected to be mailed to shareholders of record. Copies of the
Arrangement Agreement, the forms of voting support agreements and
proxy materials in respect of the Shareholders' Meeting will be
available on SEDAR+ at www.sedarplus.ca.
Advisors
Keefe, Bruyette, & Woods Inc. acted as financial advisor to
the Company. Blair Franklin Capital Partners Inc. acted as
financial advisor to the Special Committee. Borden Ladner Gervais
LLP and Dentons acted as legal advisors to the Company. Blake,
Cassels & Graydon LLP and Foley & Lardner LLP acted as
external legal advisors to Fiserv.
Conference Call
Management will be hosting a conference call on December 23, 2024, at 9:00AM ET to discuss the Transaction. To access
the conference call, please dial (289) 514-5100 or
1-800-717-1738.
An archived recording of the conference call will be available
until January 20, 2025. To listen to
the recording, call (289) 819-1325 or 1-888-660-6264 and enter
passcode 79248#.
About Payfare (TSX:PAY, OTCQX: PYFRF)
Payfare is a leading, international Earned Wage Access ("EWA")
company powering instant access to earnings through an
award-winning digital banking platform for today's workforce.
Payfare partners with leading e-commerce marketplaces, payroll
platforms, and employers to provide financial security and
inclusion for all workers.
For further information please visit www.payfare.com or
contact:
Cihan Tuncay, Head of Investor
Relations and Corporate Development
1 (888) 850-2713
investor@payfare.com
About Fiserv
Fiserv, Inc. (NYSE: FI), a Fortune 500™ company, aspires to move
money and information in a way that moves the world. As a global
leader in payments and financial technology, the company helps
clients achieve best-in-class results through a commitment to
innovation and excellence in areas including account processing and
digital banking solutions; card issuer processing and network
services; payments; e-commerce; merchant acquiring and processing;
and the Clover® cloud-based point-of-sale and business
management platform. Fiserv is a member of the S&P
500® Index and has been recognized as one of
Fortune® World's Most Admired Companies™ for 9 of the
last 10 years. Visit fiserv.com and follow on social media for more
information and the latest company news.
Forward Looking Statements
Information in this release contains forward-looking statements
within the meaning of securities legislation. Forward-looking
statements are generally identifiable by use of the words "expect",
"anticipate", "continue", "estimate", "may", "will", "project",
"should", "believe", "plans", "intends" or the negative of these
words or other variations on these words or comparable terminology.
Forward-looking statements are based on assumptions of future
events that the Company believes are reasonable based upon
information currently available. More particularly, and without
limitation, this news release contains forward-looking statements
and information concerning the consideration to be paid to
shareholders pursuant to the transaction, the ability of the
Company and the Purchaser to consummate the transaction on the
terms and in the manner contemplated thereby, the anticipated
benefits of the transaction, and the anticipated timing of the
transaction. Such forward-looking statements involve known and
unknown risks, uncertainties and other factors which may cause
actual results, performance or achievements to be materially
different from any future results, performance or achievements
expressed or implied by the forward-looking statements. Such
factors include, among others, the time required to prepare and
mail meeting materials to shareholders, the ability of the parties
to receive, in a timely manner and on satisfactory terms, the
necessary court, shareholder and other approvals and the ability of
the parties to satisfy, in a timely manner, the conditions to the
closing of the transaction, as well as other uncertainties and risk
factors set out in filings made from time to time by the Company
with the Canadian securities regulators, which are available on
SEDAR+ at https://www.sedarplus.ca. Actual results, developments
and timetables could vary significantly from the estimates
presented. Readers are cautioned not to put undue reliance on
forward-looking statements. The Company assumes no obligation to
update or revise any forward-looking statement, except as required
by applicable securities law.
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SOURCE Payfare Inc.
