Michael Capellas, chairman and CEO of First Data Corp., is leaving the Atlanta-based payment processor to work as a senior advisor at Kohlberg Kravis Roberts & Co., the investment group that bought the transaction processor in 2007.
During a conference call today, Capellas said he will continue to advise First Data and its new chairman and interim CEO, Joe Forehand, who has been on First Data’s board since September. Forehand will help find a permanent CEO.
Capellas said his move is consistent with his plans to improve the efficiency and market position of First Data. “We have accomplished our plans set out when the company went private in 2007,” Capellas told media members during the call.
Under Capellas’s tenure, the transaction processor gained merchants, invested in technology and cut costs, First Data says. In 2009, the company added more than 500,000 new merchants to its roster, bumping the total number of merchants to 6 million in 36 countries, First Data says.
Additionally, Capellas touted deals forming Bank of America Merchant Services LLC with Bank of America Corp., extending a merchant-processing deal with Wells Fargo Co. and renewing an agreement with PNC Bank (
Forehand, who as CEO of Accenture Ltd., a New York-based management consulting firm, took that company through an initial public offering in 2001.
First Data has no immediate plans to conduct an IPO, Forehand said. Many factors must be assessed before the company can address a decision to go public, Forehand said during an earlier conference call with analysts this morning.
Notably, profitable growth must be attained, he said. “Once we move into that phase and start to capitalize on some of the investments we made, …we will sort out the right time” for an IPO, he said.
Though First Data’s fourth quarter and 2009 earnings show revenue growth, the processor still lost money.
Fourth-quarter revenue totaled $2.6 billion, up 13% from the $2.3 billion during the same period a year earlier. First Data reported a $338.4 million loss for the quarter, which compares with a $3.2 billion loss during the same period in 2008.
The formation of Bank of America Merchant Services last year drove much of the revenue growth, First Data says.
For the year, First Data generated revenue of $9.3 billion, up 5.7% from $8.8 billion in 2008. The processor posted a loss for the year of $1.1 billion, an improvement from the $3.8 billion loss a year earlier.
