STRATEGIC PARTNERS
January 19, 2003
LEAWOOD, Kan. -- Euronet Worldwide, Inc. (Nasdaq: EEFT) has sold all of its shares of Euronet Services (UK) Ltd., its UK subsidiary, to private equity firm Bridgepoint Capital Limited in a $29.6 million management buy-out.
According to a news release, managing director Ron Delnevo will continue to run the company, which has been renamed Bank Machine Ltd. Euronet Worldwide will drive and process the transactions for 745 UK ATMs and any new ATMs added to the network, subject to certain contractual terms, for five years.
Under the terms of the all-cash sale, Euronet will receive approximately $28 million in cash after taxes and certain working capital and other adjustments. Euronet plans to use the proceeds to repay debt and/or invest in new business.
"This transaction fits well within our long-term strategy of building our outsourcing business and adds a significant amount of cash to our balance sheet," said Michael J. Brown, Euronet chairman and chief executive, in the release. "As a pure-play outsourcer for ATMs in the UK, Euronet will focus on locking in more outsourcing contracts, and our goal is becoming the largest ATM outsourcer in Europe."
"We are excited about the growth opportunities for the UK ATM network," said Andrew Burgess, Bridgepoint Capital director, in the release. "We expect the network to increase to well in excess of 900 ATMs by the end of 2003."
Burgess added, "There is significant potential for Euronet to benefit from the strategic withdrawal from ATM provision of the smaller UK banks and building societies who are likely to dispose of all or part of their estates in the short to medium term."
Delnevo said, "We are already a significant player in the growing independent operation and outsourcing of ATMs in the UK. We now have the funding in place to implement the rollout of significant numbers of ATMs each year, particularly in the 'through the wall' market."
Euronet Services (UK) was founded in 1998 and has been a member of the LINK network since 2001. It typically installs ATMs on a full-service basis, with no charge to the site owner. Services provided include performance monitoring, maintenance and cash replenishment.
All 22 of the company's current employees will remain with Bank Machine Limited.
