Filed by First Data Corporation
pursuant to Rule 425 under the Securities Act of 1933
and deemed filed pursuant to Rule 14a-12
of the Securities Exchange Act of 1934
Commission File No: 001-31527
Subject Company: Concord EFS, Inc.
An Agreement and Plan of Merger among First Data Corporation, Monaco Subsidiary
Corporation and Concord EFS, Inc. dated as of April 1, 2003 was filed by First
Data Corporation as Exhibit 2.1 to its Current Report on Form 8-K filed today
and is incorporated by reference in this filing.
First Data Corporation and Concord EFS, Inc. issued the following joint press
release today:
FIRST DATA AND CONCORD TO MERGE;
COMBINATION WILL OFFER CHOICE, VOICE AND INNOVATION
IN ELECTRONIC TRANSACTIONS TO BANKS, MERCHANTS AND CONSUMERS
$10 Billion in Combined Revenues
Companies to Discuss Transaction in 11 a.m. EST Conference Call Today
New York - April 2, 2003 - First Data Corp. (NYSE: FDC), a global leader in
electronic commerce and payment services, and Concord EFS, Inc., (NYSE: CE), a
leading electronic transaction processor, today announced a definitive agreement
to merge in an all-stock transaction valued at approximately $7 billion. Upon
completion of the transaction, the combined company will provide banks,
merchants and their customers with more options to conveniently and securely
conduct a full range of electronic payment transactions. The combined company
will have approximately $10 billion in annual revenues with more than 31,000
employees worldwide.
"This is a significant step in developing an open and flexible electronic
payments system that will foster competition to the benefit of consumers,
merchants and banks," said First Data Chairman and Chief Executive Officer
Charlie Fote. "Our transaction with Concord and its STAR/sm/ network will enable
First Data to provide its customers with more choices in products and services.
Access to our combined depth and scale will give banks and merchants an
unprecedented voice in the introduction of innovative payment offerings to
consumers."
"Today's announcement will combine the proven strengths of two great
organizations. Concord brings to the combined company scale and processing
expertise in strategic growth markets such as supermarket and petroleum, along
with the national debit presence of the STAR/sm/ Network," said Dick Kiphart,
Chairman of Concord. "Combining First Data's merchant point-of-sale presence and
global processing capability, Concord's real-time payments expertise and
capabilities, and the STAR/sm/ network, will provide customers with the most
innovative and cost effective solutions for all of their electronic payment
needs."
First Data will exchange 0.40 First Data common shares for every Concord
common share. At yesterday's closing price of First Data stock, the transaction
was valued at $13.87 for each common share of Concord. To complete the
transaction, First Data will issue approximately 200 million common shares to
Concord shareholders. Upon completion of the transaction based on the current
shares outstanding, Concord shareholders will own approximately 21% of the
outstanding shares of First Data. The exchange of shares in the merger is
expected to qualify as a tax-free reorganization, allowing Concord shareholders
to defer any gain on their shares for U.S. income tax purposes.
The transaction is expected to be neutral to First Data's earnings per
share in 2004, prior to restructuring and integration charges, and accretive
thereafter. The combined company expects to generate cost savings of
approximately $230 million on an annualized basis by 2005.
The transaction is subject to approval by shareholders of each company,
regulatory approval and other customary closing conditions.
Merrill Lynch and JPMorgan acted as financial advisors to First Data, and
Sidley Austin Brown & Wood acted as legal advisor. Goldman, Sachs & Co. and
William Blair & Co. acted as financial advisors to Concord, and Kirkland & Ellis
acted as legal advisor.
(Editors Note: see attached fact sheet for additional details concerning First
Data and Concord).
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CONFERENCE CALL:
First Data and Concord will host a conference call to discuss the transaction
today, April 2, at 11 a.m. EST.
To listen to the broadcast, please log on to http://www.firstdata.com and click
on the link under the "Invest" section at least 15 minutes prior to the start of
the call. To
participate in the call, dial 888-831-9087 (U.S.only) or 712-271-0110
(international) ten minutes prior to the start of the call and enter passcode
FDC.
A replay of the webcast will be available on the site beginning April 3
continuing through 5 p.m. April 9 or call 800-945-7977 (U.S.) or 402-220-3589
(international). No passcode is required.
INVESTOR RELATIONS CONTACTS:
David Banks (First Data) 303-967-8057 Ed Winnick (Concord) 302-791-8484
MEDIA RELATIONS CONTACTS:
Greg Rossiter (First Data) 303-967-6275 Melinda Mercurio (Concord) 302-791-8109
First Data Corp. (NYSE: FDC), with global headquarters in Denver, helps power
the global economy. As a leader in electronic commerce and payment services,
First Data serves approximately 3 million merchant locations, 1,400 card issuers
and millions of consumers, making it easy, fast and secure for people and
businesses to buy goods and services using virtually any form of payment. With
29,000 employees worldwide, the company provides credit, debit, smart card and
stored-value card issuing and merchant transaction processing services; Internet
commerce solutions; money transfer services; money orders; and check processing
and verification services throughout the United States. First Data also offers a
variety of payment services in the United Kingdom, Australia, Canada, Japan,
Mexico, Spain, the Netherlands, the Middle East and Germany. Its Western Union
and Orlandi Valuta money transfer networks include a total of approximately
151,00 agent locations in more than 195 countries and territories.
Concord, a leading electronic transaction processor, provides the technology and
network systems that make payments and other financial transactions faster, more
efficient and more secure than paper-based alternatives. Primary activities
include Network Services, providing ATM driving, gateway services, and debit
card processing to the financial services industry, plus coast-to-coast network
access under the STAR/sm/ brand; Payment Services, providing credit, debit,
check authorization, and EBT processing services to supermarkets, gas stations,
restaurants and other selected retail segments; and Risk Management Services,
providing software, information, and analysis to financial institutions,
retailers, government service providers, and other businesses to assist in fraud
prevention and reduction.
This communication is not a solicitation of a proxy from any security holder of
First Data Corporation or Concord EFS, Inc., and First Data Corporation and
Concord EFS, Inc. will be filing with the Securities and Exchange Commission a
joint proxy statement/prospectus to be mailed to security holders and other
relevant documents concerning the planned merger of Concord EFS, Inc. with a
subsidiary of First Data Corporation. WE URGE INVESTORS TO READ THE JOINT PROXY
STATEMENT/PROSPECTUS AND ANY OTHER RELEVANT DOCUMENTS TO BE FILED WITH THE SEC,
BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION. Investors will be able to
obtain the documents free of charge at the SEC's website, www.sec.gov. In
addition, documents filed with the SEC by First Data Corporation will be
available free of charge from First Data Investor Relations, 6200 S. Quebec St.,
Suite 340, Greenwood Village, CO, 80111. Documents filed with the SEC by Concord
EFS, Inc. will be available free of charge from Concord Investor Relations, 2525
Horizon Lake Drive, Suite 120, Memphis, TN, 38133.
First Data Corporation and Concord EFS, Inc., and their respective directors and
executive officers and other members of their management and employees, may be
deemed to be participants in the solicitation of proxies from the stockholders
of First Data Corporation and Concord EFS, Inc. in connection with the merger.
Information about the directors and executive officers of First Data Corporation
and their ownership of First Data Corporation stock is set forth in the proxy
statement for First Data Corporation's 2002 annual meeting of stockholders.
Information about the directors and executive officers of Concord EFS, Inc. and
their ownership of Concord EFS, Inc. stock is set forth in the proxy statement
for Concord EFS, Inc.'s 2002 annual meeting of stockholders. Bond Isaacson, who
became Co-Chief Executive Officer of Concord in 2002, holds approximately
400,000 Concord stock
options. Employment and compensation agreements of certain potential
participants, including change of control arrangements, are filed as exhibits to
the Concord Form 10-K filed March 27, 2003. Executive officers of Concord may
participate in a retention bonus program that would pay bonuses in connection
with the merger. Investors may obtain additional information regarding the
interests of the participants by reading the joint proxy statement/prospectus
when its becomes available.
NOTICE TO INVESTORS, PROSPECTIVE INVESTORS AND THE INVESTMENT COMMUNITY
CAUTIONARY INFORMATION REGARDING FORWARD-LOOKING STATEMENTS
Statements in this press release regarding the proposed merger of First Data
Corporation and Concord EFS, Inc. which are not historical facts, including
expectations of financial results for the combined companies (e.g., projections
regarding revenue, earnings, cash flow and cost savings), are "forward-looking
statements." All forward-looking statements are inherently uncertain as they are
based on various expectations and assumptions concerning future events and they
are subject to numerous known and unknown risks and uncertainties which could
cause actual events or results to differ materially from those projected.
Investors are cautioned not to place undue reliance on these forward-looking
statements and any such forward-looking statements are qualified in their
entirety by reference to the following cautionary statements.
Important factors upon which the forward-looking statements presented in this
release are premised include: (a) receipt of regulatory and shareholder
approvals without unexpected delays or conditions; (b) timely implementation and
execution of merger integration plans; (c) the ability to implement
comprehensive plans for asset rationalization; (d) the successful integration of
the IT systems and elimination of duplicative overhead and IT costs without
unexpected costs or delays; (e) retention of customers and critical employees;
(f) successfully leveraging First Data/Concord's comprehensive product offering
to the combined customer base; (g) continued growth at rates approximating
recent levels for card-based payment transactions and other product markets; (h)
no unanticipated changes in laws, regulations, credit card association rules or
other industry standards affecting First Data/Concord's businesses which require
significant product redevelopment efforts, reduce the market for or value of its
products or render products obsolete; (i) no unanticipated developments relating
to previously disclosed lawsuits or similar matters; (j) successful management
of any impact from slowing economic conditions or consumer spending; (k) no
catastrophic events that could impact First Data/Concord's or its major
customer's operating facilities, communication systems and technology or that
has a material negative impact on current economic conditions or levels of
consumer spending; (l) no material breach of security of any First
Data/Concord's systems; and (m) successfully managing the potential both for
patent protection and patent liability in the context of rapidly developing
legal framework for expansive software patent protection. In addition, the
ability of First Data/Concord to achieve the expected revenues, accretion and
synergy savings also will be affected by the effects of competition (in
particular the response to the proposed transaction in the marketplace), the
effects of general economic and other factors beyond the control of First
Data/Concord, and other risks and uncertainties described from time to time in
First Data/Concord's public filings with United States Securities and Exchange
Commission.
FIRST DATA-CONCORD MERGER: DEAL FACT SHEET
Parties First Data Corporation Concord EFS, Inc.
Exchange: Symbol NYSE: FDC NYSE: CE
Company First Data is the largest global payments Concord is a vertically integrated
Description company in the world and helps power the electronic transaction processor.
global economy. As a leader in electronic Primary activities include Network
commerce and payment services, First Data Services, providing ATM driving, gateway
serves approximately 3 million merchant services, and debit card processing;
locations, 1,400 card issuers and coast-to-coast network access under the
millions of consumers, making it easy, STAR brand; Payment Services, providing
fast and secure for people and businesses credit, debit, check authorization; EBT
to buy goods and services using virtually processing services to supermarkets, gas
any form of payment. stations, restaurants; Risk Management
Services, providing software, information,
and analysis to assist in fraud avoidance
and reduction.
Headquarters 6200 South Quebec Street 2525 Horizon Lake Drive
Greenwood Village, CO 80111 Memphis, TN 38133
Tel: (303) 488-8000 Tel: (800) 238-7675
CEO Charlie Fote Dan M. Palmer (co-CEO)
Bond R. Isaacson (co-CEO)
CFO Kim Patmore Edward T. Haslam
President and COO Scott Betts, President, Merchant Edward A. Labry III, President
Services; Christina Gold, President,
Western Union Financial Services; Pam
Patsley, President, First Data
International
Fiscal year ends 12/03 12/03
Total Shares 752.8 million 486.5 million
Outstanding (4/1)
Employees 29,000 2,640
Annual Revenue $7.6 billion $2.0 billion
(2002)
EPS (2002) $1.62 $0.57
Market Cap $26.1 billion $5.8 billion
As of 4/1/03
Website www.firstdata.com www.concordefs.com
Advisors: Merrill Lynch and JPMorgan acted as Goldman, Sachs & Co. and William Blair &
financial advisors to First Data, and Co. acted as financial advisors to
Sidley Austin Brown & Wood acted as legal Concord and Kirkland & Ellis acted as legal advisor.
advisor.
Transaction Fixed exchange ratio: 0.40 First Data shares for each Concord
summary share
Value as of 4/1/03: $13.87 per Concord share or approximately
$7 billion
Structure: Tax free merger
Caps and Collars: None
Approvals: Subject to shareholder and regulatory approval
Expected close: 3Q 2003
Board: 1 Concord Director to join First Data Board
Deal Rationale Strategically Compelling
. Strengthens position as leading payments provider
. Enhanced competitive position in electronic payments
industry
. Adds strong presence in high-growth payment segments
. Transform online debit capabilities
Industry Benefits
. Greater payment choices for consumers, merchants and
banks (via expansion of PIN-debit)
. Greater voice for banks and merchants in payment
industry
. Size and scale enables industry innovation
Low Risk
. Proven merger integration skills
. Largely transaction-based (recurring) revenue
. Complementary clients, products, processes and
technology
Strategic Complementary Business Fit
Rationale . Creates a more integrated provider of payment
processing services
Attractive Business Mix
. Continues to build high growth business model
Financially Attractive
. Accretive to GAAP earnings in 2005
Cross Sell Opportunities
. STAR Network, merchant and issuer processing,
TeleCheck, TASQ equipment management
FOR FURTHER INFORMATION PLEASE CONTACT:
Greg Rossiter - First Data, 303-967-6275
Melinda Mercurio - Concord, 302-791-8109