29th April 2011. Computershare Limited, the world’s largest share registry operator (ASX:CPU) has announced that it has agreed to acquire The Bank of New York Mellon Corporation’s Shareowner Services Business for a total value of US$550m in an all cash transaction.
The transaction will be funded from available cash resources and new credit lines. Two of Computershare’s long standing banking partners have committed to provide up to US$550m bridging finance.
The transaction is subject to usual closing conditions including United States anti-trust clearance. If the required anti-trust clearance is not obtained, a reverse break fee of US$30m will be payable by Computershare to BNY Mellon.
The Business is a leading provider of Transfer Agency and Employee Equity Plan services to US publicly listed companies. It has about 950 Transfer Agent clients and about 200 Employee Equity Plan clients. The Business has operations at a range of locations, with its major processing centre and headquarters in Jersey City, New Jersey.
Revenues for the Business in calendar year 2010 were US$291m. The acquisition is expected to be management earnings per share accretive for Computershare. As the Business is integrated, Computershare expects to obtain cost synergies in the same way that it has in previous transactions of a similar nature.
The integration team will include senior management from both businesses and will be augmented by specialist Computershare staff drawn from around the world. The integration team will be responsible for managing the transition of the Business into Computershare.
Stuart Crosby, CEO and President of Computershare Limited said, “This is the largest acquisition in Computershare’s history. It provides a wonderful opportunity to further demonstrate our technology and processing capabilities to a new group of clients. It also provides Computershare with additional opportunities to participate in the inevitable upturn in corporate actions and global interest rate cycles. “Our transfer agency and employee share plan services businesses provide excellent services for issuers and investors. We look forward to maintaining and building on our current service levels for existing clients, and to introducing the Business’s issuers and investors to our offering once regulatory approval has been obtained.”
Computershare (CPU) is a global market leader in transfer agency and share registration, employee equity plans, proxy solicitation and stakeholder communications. It also specialises in corporate trust services, tax voucher solutions, bankruptcy administration and a range of other diversified financial and governance services. BNY Mellon is a leading provider of financial services for institutions, corporations and high-net-worth individuals, offering superior investment management and investment services through a worldwide client-focused team.