trending
Activist hedge fund Elliott Management has acquired a significant stake in Global Payments, following a tumultuous period for the US-based payment processor after its $24.2bn acquisition of Worldpay.
The deal — one of the largest in the sector’s recent history — triggered a sharp market reaction, wiping 17.5% off the company’s value on the day of the announcement.
What the Problem?
Elliott builds stake in Global Payments
The three-way transaction, completed in conjunction with private equity firm GTCR and financial technology provider FIS, came as a surprise to many investors.
Just months prior, Global Payments had emphasised a strategic pivot toward divestitures and capital returns, including share buybacks and dividends.
The abrupt shift in corporate strategy has raised questions about management credibility, particularly after Global Payments scaled back its capital return target for 2025–2027 from $7.5bn to $7bn to help fund the deal.
Elliott’s precise stake and intentions remain undisclosed, but the activist investor’s presence typically signals an appetite for change.
While Elliott cannot block the transaction — as the deal structure circumvents the need for shareholder approval — its influence as a major stakeholder could shape how Global Payments navigates the integration of Worldpay into its merchant services business.
Global Payments
Global Payments’ stock has partially recovered since the initial drop, yet it still trades at a subdued valuation of just 7x earnings — one of the lowest multiples in the sector.
The company is struggling to maintain investor confidence as it contends with growing debt, legacy technology systems, and intensifying competition from cloud-native challengers like Stripe, Adyen, and Toast.
Industry-wide, consolidation moves once hailed as transformative have aged poorly.
Only a few — notably Fiserv’s $22bn acquisition of First Data — have delivered sustained shareholder value.
Others, including previous tie-ups involving Global Payments, FIS, and Fiserv, have seen confidence erode, leading to asset sales and strategy reversals.
Elliott, which manages $72.7bn in assets, has previously targeted major technology and fintech firms, including PayPal and FIS.
Its new position adds to a growing list of interventions across the sector.
Speaking at a recent investor event, Global Payments CEO Cameron Bready attributed the market backlash to macroeconomic volatility, particularly fallout from US trade policies.
Nonetheless, he insisted the Worldpay acquisition strengthens the company’s long-term trajectory: “There’s not a scenario I contemplate where we’re not better off with this deal.”
Yet, with Elliott now at the table and debt levels rising, the burden of proof sits squarely with Global Payments’ leadership.
Comments