News

Court fast tracks First Data/Concord case

October 29, 2003

DENVER and MEMPHIS, Tenn. - U.S. District Court Judge Rosemary Collyer on Oct. 28 entered a scheduling order in the litigation filed by the Department of Justice with respect to the proposed merger of First Data (NYSE: FDC) and Concord EFS, Inc. (NYSE: CE), the two companies announced.

The order provides that a hearing on the government's motion for a preliminary injunction will be consolidated with a trial on the merits and will begin on Dec. 15.

"The union of First Data and Concord is pro-competitive and good for the payments industry. We look forward to proving that in court and are thankful that the court has agreed to an expedited schedule," said Charlie Fote, First Data's chairman and chief executive.

On April 2, First Data and Concord announced that the two companies had entered into a definitive agreement to merge in an all-stock transaction valued at approximately $7 billion.

According to the companies' statement, they worked cooperatively with the DOJ seeking clearance under the Hart-Scott-Rodino Antitrust Improvements Act. However, the DOJ on Oct. 23 filed a civil antitrust lawsuit to block the proposed merger. Consummation of the merger remains subject to such litigation. (See related story DOJ sues to block First Data/Concord merger)

The DOJ's suit contends that the merger would reduce competition in the EFT industry, particularly in the area of PIN-based debit transactions, which would result in higher prices for merchants and consumers.

Some financial analysts have estimated that the combination of First Data's majority interest in the NYCE network, along with Concord's Star, MAC and Cash Station networks, would give a combined company control of about 70 percent of the PIN debit market.

Calling the DOJ's complaint, "inaccurate and ill advised," First Data and Concord say the merger will encourage innovation in EFT products and offer greater choice for both consumers and merchants.

First Data and Concord also announced that its shareholders voted to approve the transaction during separate meetings held on Oct. 28.