TSYS, which is the parent company of Global Payments, is currently focusing its efforts and hopes on making what can be called financial synergies a reality as part of moving forward, a process largely based on the acquisition of Worldpay.
The mentioned acquisition cost TSYS $22.7 billion. This is a significant financial injection, from which it is logical to expect no less significant results. Following the appropriate logic, TSYS expects $600 million in synergies.
The deal to acquire Worldpay is assessed by the new owner not as an event in the context of the corporate business space, but as a more significant move on a global scale, capable of generating certain changes at the industry level. TSYS expects that the addition of a new brand to its ownership structure will be a kind of transformative impulse in terms of the impact on competition in the merchant services and payment technologies area. The company hopes that the mentioned deal will change the dynamics of the competition process in the specified functional space.
The acquisition of Worldpay was announced last month. The relevant process is expected to be finalized in the first half of next year. It is probably then that the synergy that has become the destination for TSYS’ hopes will gradually transform into a fact of reality and leave the limits of a predictive vision of the future, which is more a desire than something that has taken place and undoubtedly exists.
Global Payments will divest its Issuer Solutions business to FIS. For this, the company will receive $ 13.5 billion. Global Payments will then be able to focus on a pure-play merch solutions provider.
The combined entity will serve more than 6 million consumers. In this case, we mean clients living in 175 countries, which is an obvious global scale. The expected annual volume of transactions that the entity will process is $3.7 trillion. The total number of relevant operations is at the 94 billion mark. This scale clearly goes beyond what corresponds to such a concept as the regional level. Against this background, the company fully corresponds to the status of one of the world’s largest payment processors.
As part of the strategic plan, in this case, a kind of semantic core is the desire to achieve the already mentioned synergy in the amount of $ 600 million. Separately, it should be clarified that within the framework of the relevant goal setting, the specified indicator is considered not as a one-time financial effect, but as an annually generated result. The company’s expectations suggest that the synergy will become a reported reality within three years of the final completion of the deal to acquire Worldpay. Data from Global Payments indicates that the firm intends to achieve its target result by implementing a plan such as consolidating the technological infrastructure. Apart from that, the company expects that the synergy effect will become a reality, including as a result of eliminating overlapping costs for vendors and software. The firm believes that the two measures mentioned will provide about a third of the expected savings.
The company also provided some other ways to achieve a synergistic effect, which is considered by the firm as an additional one. As part of the relevant package of intentions, there is a plan for streaming operations. Besides, the company considers the integration of product offerings as one of the steps towards achieving additional synergy effects. Another measure that will be implemented as part of the pursuit of the goal and for its final achievement is to expand the scale of the brand’s presence in the global market.
The company also predicts that it will generate annual revenue of at least $200 million due to cross-selling activities. It is expected that this result will be provided by the additional capabilities of the two firms in the merchants sector, the entrepreneurship area, and the e-commerce space.
Global Payments chief executive officer Cameron Bready, in a statement made in the context of commenting on the company’s earnings for the first quarter of 2025, drew special attention to the transformative nature of the deal to acquire Worldpay. According to him, the mentioned background created a tremendous opportunity to drive significant revenue and cost synergies. He argues that the corresponding prospects are the result of the strengthening of collective advantages in entering the market. Also, according to him, the company will simplify its business to become a pure-play merchant solutions provider with significantly expanded capabilities, wide scale, and greater market access. Separately, Cameron Bready said that the deal would help improve the financial profile of the combined company and unlock its value to shareholders in the long term.
Global Payments’ earnings for the first quarter of 2025 turned out to be very moderate and clearly not impressive. The company’s GAAP revenue for the mentioned period was $2.41 billion. At the same time, the adjusted operating margin for the first quarter of 2025 demonstrated a result that can be perceived as an argument in favor of an optimistic outlook in the context of an objective assessment. This figure was 42.4%. The year-on-year growth reached 70 basis points. The company’s forecast for the constant currency adjusted net revenue growth for 2025 has not changed so far. In this case, the firm expects the indicator to grow by 5%-6%. As for adjusted EPS growth, an increase of 10%-11% is expected in the context of the corresponding reading.
The stability of the forecasts, which contain the expectations of the upward dynamic, is unequivocal evidence of the company’s operational sustainability. From the point of view of the financial aspect of the company’s existence, it is in good condition ahead of the integration of Worldpay. It is highly likely that integration will strengthen the company’s position as an industry player in the context of its competitiveness and as a kind of corporate space characterized by internal efficiency.
Global Payments is currently on a trajectory of consistent scaling. It is worth noting that in this case, the company demonstrates not only what can be called a quantitative increase, but also qualitative growth. The firm follows the appropriate path through acquisitions. One of the latest deals was the integration of EVO Payments. As part of this large-scale action, the company expects to increase its global reach.
Throughout its history, which began 54 years ago, Worldpay has managed to establish itself in the fintech environment as a leading multinational payment processor. The company’s revenue for 2023 was $4.9 billion. The scale of the firm’s activities is significant, as evidenced by specific indicators according to which the brand serves merchants and financial institutions in 146 countries. The company’s operating system processes transactions in 135 currencies.
Worldpay has significant capabilities in the enterprise and e-commerce sectors. The company has a platform that offers commerce solutions. Special attention should be paid to the fact that this platform, which is comprehensive, covers the entire merchant spectrum. As part of the merger, Worldpay’s strengths will be combined with Global Payments’ capabilities regarding functional offerings for small and medium-sized businesses and vertical-specific solutions.
As we have reported earlier, Worldpay Acquires Ravelin.
