Fidelity National Information Services (FIS) says it has entered into a definitive agreement to acquire US electronic payments firm eFunds in an all cash transaction worth approximately $1.8 billion.
Arizona-based eFunds said in May that it was exploring potential merger opportunities after being approached by potential suitors. Fidelity was reported to be a potential bidder for eFunds earlier this month, along with Fiserv.
Under the terms of the agreement with Fidelity, eFunds shareholders will receive $36.50 in cash for each share of common stock.
In a statement Fidelity executive chairman, William Foley, says the acquisition of eFunds extends Fidelity's presence in the US and international banking markets.
"The addition of EFD's (eFunds) complementary product offerings, including EFT and prepaid card processing capabilities, underscores FIS' commitment to provide the broadest range of products and services to our customers," adds Foley.
Fidelity says it expects to realise approximately $65 million in annual cost savings and expects the deal to be accretive to cash earnings in 2008.
The transaction is expected to be completed by the end of Q3 2007, subject to shareholder and regulatory approvals and customary closing conditions.