EDS Acquisition Gives Fiserv 34% Share Of CU Market
Electronic Data Systems Corp., the once-preeminent credit union servicer, said it is ending its long-time
The group, which provides data processing services for almost 1,000 credit unions, is the remnant of what was once a far-flung
"Essentially, we're putting our focus on our core IT business, information technology, that's really our focus," said Sean Healy, a
Under the terms of the deal, Fiserv will pay $218 million in cash and EDS will retain $12 million in receivables for the operations.
More Than One-Third of CUs
The agreement propels Fiserv into the role of leading provider of back-office services for credit unions, expanding its already
The EDS operations, located in Plano and San Antonio, Texas, Phoenix, Madison, Wis., Orlando, Huntersville, N.C., and St.
The 450 EDS employees in those locations will become Fiserv employees after completion of the deal.
Fiserv already provides either in-house or host processing for about 2,400 credit unions through its AFTECH, GalaxyPlus,
Fiserv does not plan to consolidate the nine different data processing operations, at least in the short-term, according to Muma.
But in the longer term the company will be reviewing the operations to see where they can make cost-savings and improvements
The deal, which would give Fiserv a market share of around 34% in data processing services for credit unions, has been reviewed
For EDS, the deal represents the latest of another effort to right the company's finances and an exit from the credit union industry,
EDS Struck By Several Blows
EDS, which has been staggered recently by several major blows, including major losses on contracts with bankrupt WorldCom
Fiserv, with last fall's purchase of EDS' ATM switching and funds transfer business for $310 million, provided virtually all of the
After completion of the deal Fiserv will provide some kind of service to 13,000 financial institutions, including more than half of