Bulletin: Total System Services Inc. Ratings Are Unaffected By Its Plan To Acquire Cayan

NEW YORK (S&P Global Ratings) Dec. 18, 2017--S&P Global Ratings said today that Columbus, Ga.-based payment processing provider Total System Services Inc. (TSS)'s announcement that it intends to acquire Cayan, a payment technology company, for approximately $1.05 billion, has no immediate impact on the ratings on TSS. The company expects to close the transaction in the first quarter of 2018. Assuming an all-debt funded transaction, we estimate that the acquisition will increase pro forma leverage to the low-3x area, up from about 2.5x as of Sept. 30, 2017. TSS has a defensible position as one of the major outsourced service providers to the U.S. card issuing community. Its merchant segment is on track to produce net revenue of over $1

...NEW YORK (S&P Global Ratings) Dec. 18, 2017--S&P Global Ratings said today that Columbus, Ga.-based payment processing provider Total System Services Inc. (TSS)'s announcement that it intends to acquire Cayan, a payment technology company, for approximately $1.05 billion, has no immediate impact on the ratings on TSS. The company expects to close the transaction in the first quarter of 2018. Assuming an all-debt funded transaction, we estimate that the acquisition will increase pro forma leverage to the low-3x area, up from about 2.5x as of Sept. 30, 2017. TSS has a defensible position as one of the major outsourced service providers to the U.S. card issuing community. Its merchant segment is on track to produce net revenue of over $1 billion in 2017, on a standalone basis. Including the fast growing Cayan, with projected net revenue of about $150 million in 2017, merchant is on pace to closely follow its largest cash flow contributing issuer segment. Despite the hefty purchase price, the...

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