Worldpay CEO Advices Fiserv and First Data on Their Forthcoming Merger

Friday, March 29th, 2019

Worldpay Inc., the international processor, is interweaving the combined assets in the momentous merger between Vantiv Inc. and Worldpay plc. According to leading executives, the worldwide processor plans to make more acquisitions in 2019.

In a press briefing with stock analysts, CEO Charles Drucker commented on the Cincinnati-based Worldpay’s Q4 and full-year 2018 outcomes, but he also had some advice to offer Fiserv Inc. on its plans to acquire First Data Corp. This consolidation will be bigger than the Worldpay integration which came to a close 13 months ago.

The CEO predicts more and more large mergers, despite the many acquisitions we’ve seen among payments processors. “We believe that scale is key. It does matter,” Drucker said. “There’s a lot more acquisitions that have to occur.”

Staff Planning is Key

However, Drucker warned, that such significant consolidations can cause much trouble if not handled with care. Personnel is the number one issue Fiserv and First Data will have put into keen consideration, he said. “It’s two payment giants fusing. And they only have a little time to sort through the intricacies of the firms.”

Drucker also pointed out that there’s the need for clarity among the executives and staff, referring to their Worldpay-Vantiv consolidation and explaining that the two companies knew who was to handle what task and they implemented their strategy as soon as possible.

“The way you manage your workforce that will influence how disruptive the acquisition will be, he noted.

Client handling is also critical

The next challenge, Drucker warned, is how well the blended firms can handle their clients. The $22 billion Fiserv-First Data consolidation is anticipated to come to a close in Q3, awaiting approval from shareholders and industry regulators.

Why Drucker is the man to listen to

Certainly, Worldpay is doing well in its integration with the longstanding U.S-based Vantiv and the UK’s Worldpay dealings that the firm is already looking forward to more deals. “We’re just a year into this, and we have a good feeling about where we’re headed,” The CEO told analysts. “This year we are back in the M&A market, and we may deploy capital for the properties we deem helpful to us.”

But Drucker gave no clues on what properties Worldpay may be eyeing, except for mentioning that they will probably add to the firm’s fast-growing tech solutions sector. Results show that this division alone recorded $443.7 million in revenue in Q4, a 21% increase year-over-year, the Vantiv-Worldpay results put into consideration.  In a nutshell, the unit contributed to 41% of Worldpay’s total 2018 revenue and may proceed to make up half of revenue this 2019.

Worldpay’s chief financial officer, Stephanie Ferris also told the analysts that the Worldpay-Vantiv merger raked $52 million in cost savings in 2018, far ahead of the projected $45 million. “That means our consolidation is way ahead of schedule,” she noted. “We still look forward it to wrap it up by the close of Q2.”  The two executives closed the briefing with a $4.2 to $4.26 billion prediction for 2019’s revenue.