First Data and Concord EFS to merge

First Data Corp. and Concord EFS this morning announced an agreement to merge the two companies.

"This is a significant step in developing an open and flexible electronic payments system that will foster competition to the benefit of consumers, merchants and banks," said First Data Chairman and Chief Executive Officer Charlie Fote. "Our transaction with Concord and its STAR(SM) network will enable First Data to provide its customers with more choices in products and services. Access to our combined depth and scale will give banks and merchants an unprecedented voice in the introduction of innovative payment offerings to consumers."

With respect to projecting the financial performance of the combined companies, FDC's press release said:

The transaction is expected to be neutral to First Data's earnings per share in 2004, prior to restructuring and integration charges, and accretive thereafter. The combined company expects to generate cost savings of approximately $230 million on an annualized basis by 2005.