A New, Unnamed Player Makes a Richer Bid for Cardtronics

Nearly three weeks after reaching a definitive agreement with Hudson Executive Capital and Apollo Global Management to be acquired for $35 per share, ATM network operator Cardtronics plc has received an unsolicited offer from an unnamed buyer for $39 per share. The offer was disclosed by Cardtronics in a proxy statement to the Securities and Exchange Commission Dec. 31.

The Cardtronics board of directors has entered into a non-disclosure agreement with the prospective new buyer to facilitate discussions and negotiations about the offer. The new proposal is not subject to financing and is subject to the completion of confirmatory due diligence.

The original acquisition agreement with Hudson Executive Capital and Apollo Global Management remains in full force and effect, the parties say. In addition, the Cardtronics board has also reportedly reaffirmed its recommendation in favor of that agreement. Hudson and Apollo have formed Catalyst Holdings Ltd., managed by affiliates of Apollo, as the legal entity to facilitate the acquisition. 

Cardtronics declined to comment on the new offer and the pending status of its prior agreement with Hudson Executive Capital and Apollo Global Management.

“There is an active bidding war in process, so the buyer and price may continue to change in the coming days or weeks,” Sam Ditzion, chief executive of Tremont Capital Group, a Boston-based advisory firm specializing in the ATM and payments industries, says by email.  “It sometimes takes these types of situations to tease out the best offer.”

Ditzion adds that the Cardtronics board has fiduciary duties to find the deal that is in the best interest of its shareholders. “They previously voted the Hudson-Apollo deal was [the best deal they could find], but circumstances could change,” Ditzion says.

Hudson and Apollo made an initial offer in December of $31 per share to acquire Cardtronics and take the company private.

Cardtronics has a network of more than 270,000 ATMs, about a 10% share of the global ATM market, and claims about a 1% share of ATM withdrawals, according to an equity-research note written by Robert Napoli, an analyst at Chicago-based William Blair & Co. LLC.

A co-managing partner at Hudson Executive Capital is Douglas Bergeron, who was chief executive of point-of-sale terminal manufacturer VeriFone Inc. for 12 years until 2013.