PSCU’s largest strategic partner, First Data, announced today that it has received commitments for $3.5 billion of its common equity in a private placement. The company confirmed that the proceeds from the private placement will be used to strengthen the company’s balance sheet by relieving some debt, which is also expected to improve annual operating earnings by $375 million through lower annual interest expense.
“We believe this is a positive move for First Data and represents a strong vote of confidence by their investors in their ability to deliver innovations that will help our credit unions grow their businesses,” said Michael Kelly, President and CEO.
“This is welcome news for PSCU and its Member-Owner credit unions,” said Brian Caldarelli, PSCU EVP and Chief Financial Officer. “This allows First Data to optimize its capital structure by beginning to lower their debt burden. In addition, the investment and debt reduction gives them the financial resources to upgrade their consumer-facing payments solutions, including EMV technology. The overall impact is entirely positive for PSCU’s credit unions and affirms our decision to partner with First Data in a long-term strategic relationship centered on continual innovation.”
The transaction is expected to close on or about July 11, 2014, subject to customary closing conditions.
About PSCU: Established in 1977, PSCU (St. Petersburg, Fla.) is the nation’s leading credit union service organization (CUSO) and serves more than 1,500 financial institutions nationwide. The company is owned by nearly 700 member credit unions representing 16 million credit, debit, prepaid, online bill payment, mobile and electronic banking accounts. Comprehensive 24/7/365 member support is delivered through four Contact Centers located throughout the United States that handle more than 18 million inquiries a year.
Through a focus on collaboration and initiatives to mine the collective intelligence from all corners of the cooperative, PSCU’s Member-Owners are positioned at the leading edge of innovation. The combination of PSCU’s commitment to leadership in mobility and excellence in risk management, strategic consulting and technology creates PSCU’s foundation for the strongest partnerships with its Member-Owners. For more information, visit the PSCU website at www.pscu.com.
MEDIA CONTACTS
Jim Major, PSCU
Phone: (800) 443-7728 ext. 4189
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SOURCE: PSCU
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