Forbes- Citigroup Inc. said Wednesday it agreed to buy Bisys Group Inc. in a $1.45 billion deal meant to bolster the New York-based bank’s services catering to private equity investors, mutual fundsand hedge funds.
Bisys, based in Roseland, N.J., performs accounting and regulatory and legal compliance services for more than 3,000 mutual funds and 1,600 alternative investment funds that collectively manage roughly $700 billion. The company earned $232.2 million last year.
Under the deal, Citigroup will buy Bisys for $1.45 billion, or $11.85 per share. At the deal’s completion, Bisys will pay a 15 cent dividend, bringing the total deal value to Bisys shareholders to $12 per share. The stock closed at $11.47 Tuesday, implying a 4.6 percent premium for the deal.
Citigroup will break up Bisys’ insurance and retirement services businesses and sell them to J.C. Flowers & Co., a private equity fund. After that sale, the total cost of the Bisys deal to Citigroup will be roughly $800 million.
