Citi has signed an agreement to acquire Bisys Group, Inc. for $1.45 billion in an all-cash transaction.
Bisys’ shareholders will receive merger consideration of $11.85 per share, and a special dividend of $0.15 to be paid at the closing of the transaction by Bisys, for a total consideration of $1.47 billion.
By acquiring and retaining the Investment Services Division of Bisys, which includes the Fund Services and Alternative Investment Services businesses, Citi expects it will become a market leading provider of hedge fund and mutual fund services as well as a top-tiered administrator for the private equity industry.
At closing, Citi will sell the Retirement and Insurance Services Divisions of Bisys to affiliates of J.C. Flowers & Co. LLC, making the net cost of the transaction to Citi approximately $800 million.
“Bisys and Citi are a great fit,” said Michael Klein, co-president of Citi Markets & Banking. “Bisys’ Investment Services division propels Citi into a market leading position in hedge fund administration and mutual fund servicing, and integrating it into Citi’s global network will extend our full service client platform and reaffirm our focus on serving the needs of high growth markets including private equity and hedge funds. Bisys’ clients will now have access to the full suite of Citi’s industry leading banking and capital markets solutions.”