Blackstone, an investment and advisory firm, will invest $820 million in NCR in the form of perpetual convertible preferred shares.
The Duluth, Georgia-headquartered NCR with over 29,000 employees and business in 180 countries has been looking for alternative options to mobilize funds.
The investment will enable NCR for accelerating its strategic transformation into an integrated software and services company. NCR will use the Blackstone investment to fund a repurchase through a self-tender of up to $1 billion of its common stock.
NCR Chairman and CEO Bill Nuti said: “Blackstone is an experienced technology investor with a long-term perspective that can help us continue to drive our software-related revenue, deliver service globally, optimize our manufacturing processes and supply chain, and rationalize costs.”
NCR enables more than 485 million transactions daily across the financial, retail, hospitality, travel, telecom and technology industries.
As per the deal announced on Thursday, Blackstone will purchase $820 million of convertible perpetual preferred stock, which is convertible into shares of NCR common stock at a conversion price of $300 per share. The conversion price represents an 18 percent premium to the 30-day volume-weighted average price ended November 11, 2015.
On an as-converted basis, the preferred stock will represent approximately 17 percent of NCR’s shares outstanding after giving effect to the Blackstone investment and share repurchase.
Blackstone may convert the preferred into common at any time and may require NCR to repurchase the preferred after 8-1/2 years and every 3 years thereafter. The preferred will be mandatorily convertible into common if the stock price exceeds certain thresholds.
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