Fidelity National Shares Drop 15.8% on Worldpay Spinoff News

By Dean Seal

Shares of Fidelity National Information Services Inc. fell 15.8% to a low of $63.51 in the first two hours of trading Monday after the company said it would spin off the Worldpay merchant-solutions business it acquired in 2019.

The financial-services-technology company said before the bell Monday that it is planning to complete the spinoff of Worldpay within the next 12 months and to have Charles Drucker, the former chief executive of Worldpay, return to the helm of the separated company.

Fidelity's board has concluded that a spinoff would improve the performances of each business and unlock shareholder value as disruption in the payments space drives the need for investments in growth and a different capital allocation strategy at Worldpay, Chairman Jeffrey A. Goldstein said.

The spinoff of Worldpay also would help Fidelity target a stronger investment credit rating, Fidelity Chief Executive Stephanie Ferris said.

Activist investor and Fidelity shareholder JANA Partners said Monday that it supported the decision to spin off Worldpay. The investment firm said in December that it had engaged with management and stood behind Fidelity's decision to pursue a strategic review that ultimately led to the Worldpay spinoff plan.

"We welcome the decisive actions taken by the company and believe separating the merchant business with Charles Drucker as CEO, increasing savings targets, and aligning compensation with performance are the right steps to unlock shareholder value," JANA Managing Partner Scott Ostfeld said in a statement.

Fidelity's shares are down more than 42% over the past 12 months.

Write to Dean Seal at [e-mail]

(END) Dow Jones Newswires

February 13, 2023 12:01 ET (17:01 GMT)

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