SAN JOSE, Calif. — Electronic payment terminal vendor VeriFone Systems here today announced a definitive agreement to acquire Hypercom, Scottsdale, Ariz., another payment terminal provider, in an all-stock transaction valued at approximately $485 million, including net debt assumed by VeriFone.
Both companies' terminals are used by food retailers to process POS card transactions.
Under the terms of the transaction, which has been unanimously approved by the boards of directors of both companies, Hypercom shareholders will receive a fixed ratio of 0.23 shares of VeriFone common stock for each Hypercom share they own, valued at approximately $7.32 per share based on the closing price on November 16, 2010. VeriFone will also assume Hypercom's outstanding warrants and stock options in the transaction.
On September 30, Hypercom's board of directors unanimously rejected a proposal from VeriFone to acquire all of the outstanding common shares of Hypercom for $5.25 per share in cash, saying that the proposal "significantly undervalues" Hypercom and its future prospects and is not in the best interests of stockholders.
But in today's announcement, Philippe Tartavull, chief executive officer and president of Hypercom, said in a statement, "This transaction delivers a significant premium to our shareholders who should also benefit from the upside of being owners of an even stronger global company in the fast-growing electronic payment solutions space."