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BankAmerica buys unit
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December 22, 1998: 10:22 a.m. ET
Raises price $5 a share for rest of transaction processing operations
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NEW YORK (CNNfn) - BankAmerica Corp. said Tuesday it has agreed to buy the one-third stake in BA Merchant Services Inc. it doesn't already own for cash, boosting the amount it originally proposed to pay for the stock.
Under terms of the deal, BA Merchant holders will receive $20.50 a share, a premium over both the $15.50 a share initially offered by BankAmerica in October and the $17.5625 closing price for BAM stock Monday in New York Stock Exchange trading.
Based on the company's 48.67 million shares outstanding, and the fact that BankAmerica owns two-thirds of it, the transaction is valued at about $332 million.
Both BankAmerica and BA Merchant said they have reached a settlement with plaintiffs in shareholder class action suits regarding the proposed transaction. The merger has been approved by the boards of both companies, and heeds the recommendation of a special committee formed by BA Merchant to look into the deal.
BA Merchant Services (BPI) provides payment processing services for merchants who accept credit, charge and debit cards for goods and services. The company will become a wholly owned subsidiary of Bank of America National Trust and Savings Association when the transaction is completed. That's expected by the end of 1999's first quarter.
BankAmerica (BAC) shares were up 1/8 to 60-11/16 in early NYSE trading Tuesday. 
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