Blackstone Nears Deal to Take Minority Stake in ATM Maker NCR
November 11 2015 - 5:00PM
Dow Jones News
Blackstone Group LP is nearing a deal to pump more than $800
million into NCR Corp. after the ATM maker's effort to sell itself
foundered.
The world's largest private-equity firm now plans to announce a
deal as soon as Thursday to make the minority equity investment in
NCR, people familiar with the matter said. NCR also plans to
announce a $1 billion share buyback, some of the people said.
Blackstone is expected to receive convertible preferred shares
that pay a dividend and two board seats in exchange for the
investment, some of the people said.
The New York buyout firm will end up with an ownership stake in
NCR exceeding 15%, they said. The preferred shares are convertible
to regular stock at $30, they added. NCR stock closed Wednesday at
$26.78, giving the Duluth, Ga., company a market value of $4.5
billion.
As always, it is possible the deal could fall apart at the last
minute.
The expected agreement comes after Blackstone and other
private-equity firms vied for a possible leveraged buyout of NCR,
which carried more than $3 billion of debt as of September. That
would have made it one of the largest recent LBOs, the pace of
which has been slowed by regulatory and other headwinds.
NCR, founded in 1884, makes cash registers and other so-called
point-of-sale devices in addition to cash machines. The company has
struggled with lower demand as retail customers gravitate toward
mobile-payment devices such as Apple Inc.'s Apple Pay. NCR stock
has lost more than half its value from a 2007 high.
Blackstone is betting in part on a revival in NCR's software
business, which powers kiosks that accept mobile payments and
self-checkout lanes at many retailers, some of the people said.
The deal would be an example of a so-called private investment
in public equity. Known as PIPEs, they are sometimes used as a
fallback when a company strikes out on a full sale, and can serve
as a source of cash to help facilitate strategic or other changes.
In 2014, shoemaker Crocs Inc. took a $200 million investment from
Blackstone after abandoning an effort to sell itself.
The Wall Street Journal reported in April that NCR was exploring
strategic options including the spinoff or sale of assets or a
return of cash to investors through a dividend or share
buyback.
--Joann S. Lublin contributed to this article.
Write to Mike Spector at mike.spector@wsj.com and Dana Mattioli
at dana.mattioli@wsj.com
Access Investor Kit for "Apple, Inc."
Visit
http://www.companyspotlight.com/partner?cp_code=P479&isin=US0378331005
Subscribe to WSJ: http://online.wsj.com?mod=djnwires
(END) Dow Jones Newswires
November 11, 2015 16:45 ET (21:45 GMT)
Copyright (c) 2015 Dow Jones & Company, Inc.
Blackstone (NYSE:BX)
Historical Stock Chart
From Aug 2024 to Sep 2024
Blackstone (NYSE:BX)
Historical Stock Chart
From Sep 2023 to Sep 2024