FleetCor to Buy Comdata for About $3.45 Billion

By Dow Jones Business News, 

FleetCor Technologies Inc., which provides fuel cards and workforce payment products, has agreed to buy payments business Comdata Inc. from Ceridian LLC for about $3.45 billion.

Ceridian is owned by Thomas H. Lee Partners and Fidelity National Financial Inc.

Brentwood, Tenn.-based Comdata processes purchases, payroll and accounts payable for companies in a range of industries.

Comdata filed for an initial public offering earlier this year. The Wall Street Journal reported in June that those plans developed into a dual-track process as potential buyers approached Comdata.

FleetCor said it would finance the transaction with about $2.4 billion of new debt and the issuance of about 7.3 million common shares.

FleetCor said Comdata's virtual payments business "will add a completely new growth leg."

The deal is expected to be "meaningfully accretive" to 2015 earnings.

On July 31, FleetCor said its second-quarter profit rose 21%, citing strong organic growth and benefits from acquisitions. The company raised its 2014 guidance for adjusted earnings per share to $5.04 to $5.10, from a previous range of $4.97 to $5.07.

If the Comdata deal closes in December as scheduled, FleetCor projects adjusted 2015 earnings of $6.25 to $6.45 a share.

FleetCor shares rose 3% in late trading to $133.61.

Thomas H. Lee and Fidelity National bought payroll and employee-benefits processor Ceridian in 2007 for $5.3 billion. Before that sale, Ceridian was a target of activist investor William Ackman, who urged the company to sell Comdata.

Fidelity National Financial Ventures, a tracking stock that Fidelity National Financial formed this summer to track and reflect certain investments, said in a statement that the Comdata sale price represents a multiple of more than 12 times trailing twelve-month Ebitda.

Write to Josh Beckerman at josh.beckerman@wsj.com

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This article appears in: News Headlines

Referenced Stocks: FLT , FNF

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