Rumor has it that First Data Corp. is negotiating to buy Electronic Payment Services Inc., the owner of the MAC network.

The news was reported last Friday in CardFax, a Faulkner & Gray publication.

Electronic Payment Services' performance has disappointed owners CoreStates Financial Corp., Banc One Corp., KeyCorp, National City Corp., and PNC Bank Corp., observers say.

Smart Cash, a smart card program that cost millions of dollars to develop, failed. Chairman David Van Lear left in February; he was succeeded by Richard Garman of Montgomery Securities.

Rumors of an initial public offering or sale have been circulating since Mr. Garman joined the company as president in August 1995.

One source who wished to remain anonymous said the move "would make sense. EPS needs to do something from an organizational point of view." An Electronic Payment Services spokeswoman said the company would not comment on rumors or speculation.

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