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425
FIDELITY NATIONAL INFORMATION SERVICES, INC. filed this Form 425 on 05/13/2019
Entire Document
 


Worldpay, Inc.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (continued)

 

For the three months ended March 31, 2018, the Company incurred transaction expenses of approximately $120.8 million in conjunction with the acquisition of Legacy Worldpay. All transaction costs incurred for the three months ended March 31, 2018 are included in general and administrative expenses on the accompanying Consolidated Statements of Income.

Under the terms of the Legacy Worldpay transaction agreement, the Company replaced equity awards held by certain employees of Legacy Worldpay. The fair value of the replacement awards was approximately $82.4 million. The portion of the fair value of the replacement awards related to the services provided prior to the acquisition of approximately $44.2 million was part of the consideration transferred to acquire Legacy Worldpay. The remaining portion of the fair value is associated with future service and will be recognized as expense over the future service period.

Pro Forma Results Giving Effect to the Legacy Worldpay Acquisition

The following pro forma combined financial information presents the Company’s results of operations for the three months ended March 31, 2018, as if the acquisition had occurred on January 1, 2017 (in millions, except share amounts).

 

     Three Months Ended March 31,
2018
 
     (Pro forma)  

Total revenue

   $ 914.5  

Net income attributable to Worldpay, Inc.

     33.6  

Net income per share attributable to Worldpay, Inc. Class A common stock:

  

Basic

   $ 0.11  

Diluted

   $ 0.11  

Shares used in computing net income per share of Class A common stock:

  

Basic

     296,498,480  

Diluted

     298,027,972  

The pro forma results include certain pro forma adjustments that were directly attributable to the acquisition as follows:

 

   

additional amortization expense that would have been recognized relating to the acquired intangible assets; and

 

   

adjustment to interest expense to reflect the additional borrowings of the Company in conjunction with the acquisition and removal of Legacy Worldpay debt.

 

   

a reduction in expenses for the three months ended March 31, 2018 relating to acquisition-related transaction costs and debt refinancing costs incurred by the Company, which were applied to the three months ended March 31, 2017.

5. GOODWILL AND INTANGIBLE ASSETS

Changes in the carrying amount of goodwill for the three months ended March 31, 2019 are as follows (in millions):

 

     Technology Solutions      Merchant Solutions      Issuer Solutions      Total  

Balance as of December 31, 2018

   $ 9,608.4      $ 3,934.3      $ 595.2      $ 14,137.9  

Effect of foreign currency translation

     127.3        36.8        —          164.1  
  

 

 

    

 

 

    

 

 

    

 

 

 

Balance as of March 31, 2019

   $ 9,735.7      $ 3,971.1      $ 595.2      $ 14,302.0  
  

 

 

    

 

 

    

 

 

    

 

 

 

Intangible assets consist of acquired customer relationships, trade name and customer portfolios and related assets. The useful lives of customer relationships are determined based on forecasted cash flows, which include estimates for customer attrition associated with the underlying portfolio of customers acquired. The customer relationships acquired in conjunction with acquisitions are amortized based on the pattern of cash flows expected to be realized taking into consideration expected revenues and customer attrition, which are based on historical data and the Company’s estimates of future performance. These estimates result in accelerated amortization on certain acquired intangible assets.

 

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