The offer from the private equity firms represents a 24% premium to the stock's Friday closing price. The acquisition may signal further consolidation in the payments industry, as the firms will likely use Blackhawk as a platform for additional M&A before an eventual exit.
Pleasanton, California-based Blackhawk offers a range of services including gift cards and prepaid debit cards by partnering with companies such as PayPal (PYPL.O), American Express (AXP.N) and Western Union (WU.N). The deal includes a $1.7-billion equity commitment from Silver Lake. Sandler O‘Neill & Partners was Blackhawk’s financial adviser. Barclays, BofA Merrill Lynch and affiliates of Goldman Sachs and JPMorgan advised Silver Lake.