FOUR
Shift4 Payments, INC
NYSE
8-K: Shift4 Payments Announces $750 Million Convertible Preferred Stock Offering to Fund Global Blue Acquisition
Sentiment:
Capital Raise Announcement
30 April 2025 9:24 AM
Shift4 Payments launches a public offering of Series A Mandatory Convertible Preferred Stock to finance the acquisition of Global Blue and for general corporate purposes.
Capital raise
Shift4 Payments is launching an underwritten public offering of 7,500,000 shares of Series A Mandatory Convertible Preferred Stock.
The company expects to grant underwriters a 30-day option to purchase up to 1,125,000 additional shares to cover over-allotments.
Shift4 intends to raise up to $1,735.0 million in additional permanent debt financing.
Summary
- Shift4 Payments has announced an underwritten public offering of 7,500,000 shares of Series A Mandatory Convertible Preferred Stock.
- The company expects to grant underwriters a 30-day option to purchase up to 1,125,000 additional shares to cover over-allotments.
- The offering is subject to market conditions.
- The net proceeds, along with $1,735.0 million in additional debt financing and cash on hand, will be used for the cash consideration for the acquisition of Global Blue Group Holding AG and for general corporate purposes, including debt repayment and strategic acquisitions.
- The Mandatory Convertible Preferred Stock is expected to have a liquidation preference of $100.00 per share.
- The stock will automatically convert into a variable number of Class A common stock shares around May 1, 2028, subject to certain conditions.
- Shift4 has the right to redeem the Mandatory Convertible Preferred Stock if the Global Blue merger is not completed within a specified timeframe.
- The dividend rate and conversion terms will be determined at the time of pricing.
- The completion of the offering is not contingent upon the consummation of the merger.
- As part of a restructuring transaction, Mr. Isaacman will receive approximately $198,000,000 in value, including $80,000,000 in cash and $118,000,000 of mandatory convertible preferred stock in a private placement.
- Mr. Isaacman and Rook would enter into a customary lock-up agreement that will restrict their ability to sell the mandatory convertible stock and any shares of Class A common stock issued in respect thereof for six months after such shares of mandatory convertible preferred stock are issued.
- The closing of the Restructuring Transactions is contingent on this offering and the confirmation and appointment as administrator of NASA, but the closing of this offering is not contingent upon the closing of the Restructuring Transactions or the confirmation and appointment.
Sentiment
Score: 6
Explanation: The announcement is generally neutral. While it involves dilution for existing shareholders and increased debt, it is aimed at funding a strategic acquisition and restructuring the company's capital structure. The market's reaction will depend on its assessment of the Global Blue acquisition and the terms of the offering.
Positives
- The offering will provide Shift4 with the necessary capital to complete the acquisition of Global Blue.
- The restructuring transaction will relieve the company of an estimated $542,000,000 of future TRA payments.
- The company has access to additional debt financing of up to $1,735.0 million.
Negatives
- The offering dilutes existing shareholders.
- The company will incur additional debt of up to $1,735.0 million.
- The terms of the Mandatory Convertible Preferred Stock, including the dividend rate and conversion terms, are yet to be determined and remain subject to change.
Risks
- The completion of the Global Blue merger is not guaranteed.
- The company's ability to integrate Global Blue successfully and realize the anticipated synergies is uncertain.
- The company faces intense competition in the financial services and payments technology industries.
- Cybersecurity risks and data breaches could negatively impact the company.
- The company is subject to various laws and regulations, including those related to privacy, data protection, and anti-money laundering.
- The closing of the Restructuring Transactions is contingent on Mr. Isaacmans appointment as administrator of NASA, which is uncertain.
Future Outlook
Shift4 intends to use the proceeds from the offering and additional debt financing to complete the acquisition of Global Blue and for general corporate purposes, including debt repayment and strategic acquisitions and growth initiatives.
Industry Context
The payments industry is highly competitive, with companies like Shift4 facing competition from established players and emerging fintech companies. Acquisitions and strategic partnerships are common strategies for growth and expansion in this industry. Shift4's acquisition of Global Blue is aimed at expanding its reach and capabilities in the integrated payments and commerce technology space.
Comparison to Industry Standards
- Comparable companies such as Fiserv, Global Payments, and Adyen also utilize debt and equity financing to fund acquisitions and growth initiatives.
- Convertible preferred stock offerings are a common method for companies to raise capital while offering investors potential upside through conversion to common stock.
- The size of the offering and debt financing is significant, reflecting the scale of the Global Blue acquisition.
- The lock-up agreement for Mr. Isaacman's shares is a standard practice to ensure stability and investor confidence.
Stakeholder Impact
- Shareholders will experience dilution from the issuance of new shares.
- The company's financial leverage will increase due to the additional debt financing.
- The acquisition of Global Blue could benefit customers by expanding the company's service offerings.
- Employees may be affected by the integration of Global Blue and potential restructuring activities.
Next Steps
- Pricing of the Mandatory Convertible Preferred Stock offering.
- Closing of the public offering.
- Completion of the Global Blue acquisition.
- Closing of the Restructuring Transactions, contingent on Mr. Isaacman's appointment as administrator of NASA.
- Automatic conversion of Mandatory Convertible Preferred Stock into Class A common stock around May 1, 2028.
Related Party Transactions
- The Restructuring Transaction Agreement with Mr. Isaacman and his holding company (Rook) involves a payment of approximately $198,000,000 in value to Mr. Isaacman, including $80,000,000 in cash and $118,000,000 of mandatory convertible preferred stock in a private placement.
Key Dates
- 2024-12-31: Year ended date for Annual Report on Form 10-K
- 2025-03-31: Quarter ended date for Quarterly Report on Form 10-Q
- 2025-04-29: Date of the Restructuring Transaction Agreement with Mr. Isaacman and Rook
- 2025-04-30: Date of the press release and 8-K filing announcing the public offering
- 2028-05-01: Approximate date for automatic conversion of Mandatory Convertible Preferred Stock into Class A common stock
Keywords
Shift4 Payments, Mandatory Convertible Preferred Stock, Public Offering, Global Blue, Acquisition, Debt Financing, Restructuring Transaction, Jared Isaacman, Merger, Payments Technology
FOUR
Shift4 Payments, INC
NYSE
Sector: TBD
Filings with Classifications
Worse than expected
4 June 2025 9:29 PM
Proxy Statement Supplement
- The previously announced restructuring transactions, which aimed to simplify the company's organizational and capital structure (Up-C Collapse and TRA waiver), have been terminated.
- The termination occurred because a key condition for the restructuring was not met, indicating a failure to achieve a significant strategic objective previously communicated.
Capital raise
16 May 2025 5:03 PM
Debt Offering Announcement
- Shift4 Payments, LLC and Shift4 Payments Finance Sub, Inc. completed the issuance and sale of 680 million aggregate principal amount of 5.500% Senior Notes due 2033 (the Euro Notes) and $550 million aggregate principal amount of 6.750% Senior Notes due 2032 (the New 2032 Notes and, together with the Euro Notes, the Notes).
Capital raise
15 May 2025 4:20 PM
Pro Forma Financial Information
- Shift4 issued 10,000,000 shares of 6.00% Series A Mandatory Convertible Preferred Stock, raising $1,000,000,000.
- Shift4 LLC expects to incur a new seven-year $1,000 million senior secured term loan B facility.
- Shift4 LLC and Shift4 Payments Finance Sub, Inc. are offering 680 million aggregate principal amount of 5.500% senior notes due 2033 (the Euro Notes) and $550 million in aggregate principal amount of their 6.750% senior notes due 2032.
Capital raise
8 May 2025 5:25 PM
Debt Offering Announcement
- Shift4 Payments is issuing €680 million in 5.500% senior notes due 2033.
- Shift4 Payments is issuing $550 million in additional 6.750% senior notes due 2032.
- The company intends to use the proceeds, along with other financing sources, to fund the acquisition of Global Blue and repay existing debt.
Capital raise
5 May 2025 4:35 PM
8-K Filing
- Shift4 Payments issued 10,000,000 shares of 6.00% Series A Mandatory Convertible Preferred Stock.
- The offering generated $1 billion in aggregate liquidation preference.
- The company intends to use the net proceeds from the offering, along with additional debt financing of up to $1,735.0 million, to fund the acquisition of Global Blue Group Holding AG and for general corporate purposes.
Capital raise
30 April 2025 9:24 AM
Capital Raise Announcement
- Shift4 Payments is launching an underwritten public offering of 7,500,000 shares of Series A Mandatory Convertible Preferred Stock.
- The company expects to grant underwriters a 30-day option to purchase up to 1,125,000 additional shares to cover over-allotments.
- Shift4 intends to raise up to $1,735.0 million in additional permanent debt financing.
Capital raise
30 April 2025 7:13 AM
8-K Filing
- Shift4 is proposing to issue $750.0 million Series A Mandatory Convertible Preferred Stock via an underwritten public offering.
- Shift4 expects to grant to the underwriters a 30-day option to purchase up to an additional 15% of shares of Mandatory Convertible Preferred Stock at the public offering price, less underwriting discounts and commissions, solely to cover over-allotments.
- Shift4 and/or Shift4 LLC intend to obtain certain permanent debt financing, both secured and unsecured, of up to $1,735.0 million in order to finance a part of the cash consideration payable by Shift4 to consummate the Merger with Global Blue in lieu of leveraging the Bridge Facilities.
Capital raise
29 April 2025 4:05 PM
Quarterly Report
- Shift4 Payments, LLC (directly or through Shift4 and/or one or more of its subsidiaries) also intends to pursue a permanent financing arrangement with the Commitment Parties, as contemplated by the Debt Commitment Letter, which may include a combination of senior unsecured and/or unsecured notes, mandatory convertible or perpetual preferred equity and/or a senior secured term loan B facility (the Permanent Financing), in each case, on terms and conditions to be set forth in the definitive documentation for such Permanent Financing.
Delay expected
29 April 2025 4:05 PM
Quarterly Report
- Merger Sub announced an extension of the Expiration Time of the Offer until one minute after 11:59 p.m., New York City time, on May 6, 2025.
Better than expected
29 April 2025 7:14 AM
Earnings Release
- The company is raising its full-year guidance for gross revenue less network fees and adjusted EBITDA by $10 million on both the low and high end.
- Shift4 Payments experienced record payment volumes, gross revenue less network fees, and adjusted EBITDA in Q1 2025.
Better than expected
19 February 2025 4:06 PM
Annual Report
- The company's end-to-end payment volume increased by 51% to $164.8 billion for the year ended December 31, 2024.
- Gross revenue less network fees increased by 44% to $1.35 billion.
- Adjusted EBITDA increased to $677.4 million, compared to $459.9 million in the previous year.
- The company released a valuation allowance against certain deferred tax assets, resulting in an income tax benefit of $296.1 million.
Capital raise
19 February 2025 4:06 PM
Annual Report
- Shift4 Payments, LLC, entered into a commitment letter with Goldman Sachs Bank USA (GS), pursuant to which GS has committed to (i) provide Shift4 Payments, LLC with 364-day bridge loan facilities in an aggregate principal amount of $1.795 billion (the Bridge Facilities), consisting of (x) a senior secured 364-day bridge loan facility in an aggregate principal amount of $1.0 billion (the Senior Secured Bridge Facility) and (y) a senior unsecured 364-day bridge loan facility in an aggregate principal amount of $795.0 million (the Senior Unsecured Bridge Facility), in each case, subject to customary conditions, and (ii) to backstop an amendment to, or replacement of, Shift4 Payments, LLCs existing $450.0 million senior secured revolving credit facility (the Backstop Revolving Facility and, together with the Bridge Facilities, collectively, the Facilities) in order to, among other things, permit the consummation of the transactions contemplated by the Transaction Agreement, the incurrence of the Bridge Facilities and any other permanent financing issued in lieu thereof or to refinance the loans thereunder, in each case, subject to customary conditions.
Capital raise
18 February 2025 4:22 PM
Merger Announcement
- Shift4 expects to finance the acquisition with cash on hand and a 364-day $1.795 million bridge loan facility entered in connection with the transaction.
Better than expected
12 November 2024 4:29 PM
Quarterly Report
- The company's revenue and payment volume growth exceeded expectations.
- The company released a valuation allowance against deferred tax assets, resulting in a significant tax benefit.
- The company's net income attributable to Shift4 Payments, Inc. increased to $53.8 million.
Better than expected
12 November 2024 7:04 AM
Quarterly Report
- The company exceeded expectations with record payment volume, strong revenue growth, and increased profitability.
- Shift4 raised its full-year guidance, indicating confidence in continued performance.
- The company's adjusted EBITDA and free cash flow were better than anticipated.
Capital raise
15 August 2024 5:27 PM
Debt Offering Announcement
- The document details the completion of a $1.1 billion senior notes offering.
- The company received net proceeds of approximately $1,087.9 million.
- The proceeds will be used for general corporate purposes, including debt retirement, acquisitions, and stock repurchases.
Capital raise
12 August 2024 8:40 PM
Debt Offering Announcement
- Shift4 Payments is raising $1.1 billion through a private offering of senior notes.
- The notes are being offered to qualified institutional buyers and certain persons outside the United States.
- The proceeds will be used for general corporate purposes, including potential debt repayment.
Capital raise
12 August 2024 8:25 AM
Debt Offering Announcement
- Shift4 Payments is proposing to offer $1.1 billion aggregate principal amount of senior notes.
- The offering is a private placement to qualified institutional buyers and certain persons outside the United States.
Better than expected
8 August 2024 6:29 PM
Quarterly Report
- The company's revenue, payment volume, and subscription growth all exceeded expectations.
- The company's net income and adjusted EBITDA also showed significant improvement compared to the prior year.
Better than expected
8 August 2024 7:02 AM
Quarterly Report
- The company's Q2 results exceeded expectations, leading to an increase in full-year guidance.
- The company's end-to-end payment volume, gross revenue, and adjusted EBITDA all showed significant year-over-year growth, surpassing previous estimates.
- The company's organic revenue growth was strong at 24%, with an expected acceleration in the back half of the year.
Better than expected
9 May 2024 5:51 PM
Quarterly Report
- The company's revenue, payment volume, and adjusted EBITDA all exceeded expectations, indicating strong financial performance.
- The company's growth in subscription revenue and international expansion are positive indicators for future performance.
Better than expected
9 May 2024 7:13 AM
Quarterly Report
- The company's Q1 results exceeded expectations with a 50% increase in end-to-end payment volume and a 36% increase in adjusted EBITDA, indicating better than expected performance.
Better than expected
29 February 2024 4:06 PM
Annual Results
- The company's gross revenue increased by 29%, and end-to-end payment volume increased by 52%, both exceeding expectations.
Delay expected
27 February 2024 7:05 AM
Quarterly Report
- The company experienced delays in closing enterprise deals and the timing of certain multi-billion-dollar gateway migrations, which slightly impacted gross revenue less network fees.
Better than expected
27 February 2024 7:05 AM
Quarterly Report
- The company's key financial metrics, including end-to-end payment volume, gross profit, and adjusted EBITDA, all exceeded expectations, demonstrating strong growth and profitability.
Disclaimer: This summary was generated by artificial intelligence and its accuracy is not guaranteed. The information provided here is for general informational purposes only and does not constitute financial advice, recommendation, or endorsement of any kind. It may contain errors or omissions. You should not rely on this information to make financial decisions. Always seek the advice of a qualified financial professional before making any investment or financial decisions. Use of this information is at your own risk.