POS Terminal maker Verifone to go private

San Jose-based Verifone Systems is about to take its payments-processing technologies and services private.

On Tuesday, Verifone’s shares surged more than 52 percent, to close at $22.78, after the company said late Monday that it agreed to be acquired by a private-equity group led by Francisco Partners that also includes British Columbia Investment Management for $2.6 billion in cash.

When Verifone’s debt is included, the deal’s total value is $3.4 billion.

Under terms of the deal, Verifone shareholders will receive $23.04 a share for their company stock, which is a 54 percent premium above Monday’s closing price of $15 a share. The agreement also includes a “go-shop” period that gives Verifone’s board of directors until May 24 to seek out and potentially accept other acquisition proposals.

In a statement, Verifone Chief Executive Paul Galant said the deal to go private “reflects the progress we have made executing our transformation from a terminal sales company to a payments and commerce solutions provider.”

Verifone is best known for its point-of-sale terminals and devices for processing credit- and debit-card transactions at retail outlets. The company has also begun offering handheld mobile-payment devices and platforms to its product line.

Bottom line: This is a very high-stakes turnaround, as Verifone shares closed yesterday at their lowest level since late 2009.

More from Bloomberg:

VeriFone, whose point-of-sale card readers are retail staples, has struggled with delays in transitioning to chip-card technology in the U.S. as a lengthy certification processes for the new payment terminals delayed domestic sales. The firm also faces increased competition from Silicon Valley upstarts such as Square.

Timeline: The deal includes a “go-shop” period that expires on May 24, during which time it can solicit superior offers.

Other parties: British Columbia Investment Management is joining Francisco on the buyside, while Qatalyst Partners represented Verifone. Prior Verifone owners include buyout firms Gores Group and GTCR.

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