BISYS, a provider of outsourcing solutions for the financial services sector, announced that it has entered into a definitive agreement under which Citi would acquire all of its outstanding shares in a transaction valued at approximately $1.45b. BISYS shareholders would receive $12.00 in cash per share, consisting of $11.85 per share to be paid by Citi at the closing of the acquisition and a special dividend of $0.15 per share in cash payable by BISYS, and conditioned upon the closing of the acquisition, for total consideration of $1.47 billion.
It is expected that Citi would combine BISYS Fund Services and Alternative Investment Services, which provide administration and distribution services for mutual funds, hedge funds, private equity funds, and other investment products, with its own operations.
Simultaneously, JC Flowers, a private equity firm, would acquire BISYS’ Insurance Services Group and Retirement Services business from Citi. The Insurance Services Group provides independent wholesale distribution of life insurance and commercial property/casualty insurance. JC Flowers will be combining its existing commercial insurance business, Crump, with BISYS Commercial Insurance Services.
The BISYS Board, Special Committee and advisors (see below) conducted a review of BISYS’ strategic alternatives over an eight month period that took into account the complexity and diversity of BISYS’ businesses as well as certain tax considerations.
The Boards of Directors of Citibank, N.A. and BISYS as well as the Special Committee of independent directors of BISYS's board have each unanimously approved the transaction with Citi, and the Board of Directors of BISYS has recommended that BISYS shareholders approve the transaction. The transaction is expected to close in the second half of this year and is subject to BISYS shareholder approval and to regulatory approvals in the United States, Ireland, and Bermuda.
Advisors: Bear Stearns is serving as financial advisor to BISYS. Merrill Lynch is serving as financial advisor to the Special Committee of independent directors of BISYS's board. Skadden, Arps, Slate, Meagher & Flom LLP is serving as BISYS's legal counsel. Paul, Weiss, Rifkind, Wharton and Garrison LLP is also serving as legal counsel to the Special Committee of independent directors of BISYS's board.