Global Payments to Acquire Worldpay in Three-Way Deal

By Stuart E. Leblang, Michael J. Kliegman, and Amy S. Elliott

On April 17, fintech company Global Payments Inc. (NYSE: GPN) (Global Payments) announced ¹ that it will sell its Issuer Solutions business to rival fintech company Fidelity National Information Services, Inc. (NYSE: FIS) (FIS) in exchange for $13.5 billion cash and FIS’s 45-percent stake ² in privately held payment processing company Worldpay, LLC (Worldpay). At the same time, Global Payments will acquire the remaining 55-percent interest in Worldpay from private equity firm GTCR, LLC (GTCR) (which obtained its Worldpay stake from FIS in July 2023) for a mix of cash (59 percent) and Global Payments stock (41 percent). ³

FIS originally acquired all of Worldpay in 2019 for a mix of cash and stock (our prior report on the same is appended). ⁴ Then, in 2023, FIS announced plans to pursue a tax-free spin-off of Worldpay (we wrote about potential active trade or business concerns with the plan, which is also appended ⁵ ) but ultimately abandoned the spin in favor of selling a majority stake in Worldpay to GTCR, taking Worldpay private in early 2024. ⁶

The three-way deal between Global Payments, FIS and GTCR—in which Worldpay will be acquired for a net purchase price of $22.7 billion ⁷ —will mean that GTCR will end up owning about 15 percent of Global Payments. Separately, the FIS acquisition of Issuer Solutions will give rise to $1.5 billion of anticipated tax assets, reducing the effective purchase price of Issuer Solutions to $12 billion. ⁸Both the Worldpay and Issuer Solutions transactions are expected to close in the first half of 2026.

According to the transaction agreements, ⁹ Global Payments is actually purchasing partnership interests in Worldpay Holdco, LLC (originally called New Boost Holdco, LLC, this is the Delaware joint venture entity into which FIS transferred the assets and liabilities constituting Worldpay’s Merchant Solutions Business before selling a majority stake to GTCR). ¹⁰ We suspect the 
$1.5 billion of tax assets to FIS will largely be generated by the basis step-up it will get by purchasing the Issuer Solutions business, as it is a fully taxable transaction to all parties. ¹¹ FIS will recognize full taxable gain on the transfer of its interest in Worldpay, and Global Payments will recognize taxable gain (or loss) on the transfer of Issuer Solutions.

Therefore, we do not believe that the term “tax asset” is being used in a technical accounting sense. That is, we do not think that the acquisition will result in the creation of deferred tax assets in the stated amount on FIS’ balance sheet. More important, if it did, no company would ascribe equivalent economic value in describing the economic value of an acquisition. Rather, we think it most likely that this figure represents the estimated cash tax present value to FIS from obtaining depreciable and amortizable tax basis in the Issuer Solutions business.¹²

We note that FIS acquired Worldpay in 2019 at a deal value of approximately $43 billion, ¹³ but then wrote off substantial amounts and incurred a significant loss in the 2024 sale of a
55-percent equity interest in Worldpay to GTCR. ¹⁴ However, because the 2019 acquisition involved a cash-and-stock partially tax-free reorganization, FIS would presumably have taken not a cost basis in Worldpay, but a carryover of historical tax basis, and therefore, will recognize significant taxable gain on this transaction.

Finally, according to the transaction agreement involving GTCR, ¹⁵ following the pre-closing reorganization, approximately 32 percent of Worldpay will be held by GTCR blocker corporations whose stock is being acquired by Global Payments by way of mergers of special purpose subsidiaries into the blocker corporations. We do not think that these blocker mergers qualify as tax-free reorganizations, so they would be fully taxable to the blocker shareholders (albeit it is likely that most of these shareholders are foreign or tax-exempt). But in looking at the basis step-up to Global Payments, the blockers’ portion of Worldpay would presumably be coming over with a carryover basis.

^{[1] Press Release, Global Payments, Global Payments Announces Agreements to Acquire Worldpay and Divest Issuer Solutions (April 17, 2025) (https://www.sec.gov/Archives/edgar/data/1123360/000110465925035771/tm2512552d1_ex99-1.htm).}

^{[2] Investor Presentation, FIS, FIS Announces Strategic Transactions (April 17, 2025) (https://www.sec.gov/Archives/edgar/data/1136893/000119312525083595/d934755dex992.htm).}

^{[3] Press Release, GTCR, GTCR Announces Sale of Worldpay to Global Payments for $24.25 Billion in Conjunction with Transformative Three-Way Transaction (April 17, 2025) (https://www.gtcr.com/gtcr-announces-sale-of-worldpay-to-global-payments-for-24-25-billion-in-conjunction-with-transformative-three-way-transaction/).}

^{[4] “FIS‐Worldpay Cash‐and‐Stock Merger Is Tax‐Free at the Corporate Level and Partially Taxable to Shareholders” (March 22, 2019).}

^{[5] “Four-Years-Young Worldpay Acquisition Presents ATB Issue for Planned Spin-Off” (March 8, 2023).}

^{[6] Press Release, GTCR, Worldpay Begins Operating as Independent Company (February 1, 2024) (https://www.gtcr.com/worldpay-begins-operating-as-independent-company/) and GTCR to Acquire Majority Stake in Worldpay (July 6, 2023) (https://www.gtcr.com/gtcr-to-acquire-majority-stake-in-worldpay/).}

^{[7] Supra Note 1.}

^{[8] “The acquisition of Issuer Solutions for a net purchase price of $12 billion (total value of $13.5 billion excluding $1.5 billion of anticipated net present value of tax assets) . . .” from Press Release, FIS, FIS Announces Sale of Worldpay Stake and Strategic Acquisition of Global Payments’ Issuer Solutions Business (April 17, 2025) (https://www.sec.gov/Archives/edgar/data/1136893/000119312525083595/d934755dex991.htm).}

^{[9] For the transaction agreement by and among Global Payments and FIS, see: https://www.sec.gov/Archives/edgar/data/1123360/000110465925036553/tm2512754d1_ex2-1.htm}

^{For the transaction agreement by and among Global Payments and GTCR, see: https://www.sec.gov/Archives/edgar/data/1123360/000110465925036553/tm2512754d1_ex2-2.htm}

^{[10] https://www.investor.fisglobal.com/static-files/33e6ed4c-17d6-49de-b8f1-2a558fd81166}

^{[11] Note that Global Payments’ press release also makes mention of tax assets, although it is not clear if they are the same tax assets referenced by FIS: “Global Payments Inc. . . . announced definitive agreements to divest its Issuer Solutions business to FIS for $13.5 billion and acquire Worldpay from GTCR and FIS for a net purchase price of $22.7 billion, or total value of $24.25 billion including $1.55 billion of anticipated tax assets,” supra Note 1.}

^{[12] On the April 17 live webcast about the announcement, FIS CFO James Kehoe CFO said (at about 15:30): “This transaction will generate a tax benefit over the next 15 years, and despite the sale of Worldpay, we expect to maintain an effective tax rate of approximately 13.5%,” which supports our thinking that the FIS tax asset relates to the 15-year amortization of goodwill/§197 intangibles (https://edge.media-server.com/mmc/p/3xm84meh).}

^{[13] Press Release, FIS, FIS and Worldpay to Combine to Accelerate the Future of Finance and Commerce Globally (March 18, 2019) (https://www.investor.fisglobal.com/sites/g/files/knoqqb53356/themes/site/nir_pid2511/worldpay/rns/newsarticle-20190318-16576.html).}

^{[14] Annual Report, FIS, Form 10-K filed Feb. 13, 2025: “As a result of the Worldpay Sale, we recorded an estimated loss on sale of $578 million during 2024.” (https://www.sec.gov/ix?doc=/Archives/edgar/data/0001136893/000113689325000014/fis-20241231.htm)}

^{[15] https://www.sec.gov/Archives/edgar/data/1123360/000110465925036553/tm2512754d1_ex2-2.htm}