Blum weighs in on MoneyGram, Euronet proposed transaction, urges removal of standstill agreement

By Lisa Kerner

Charlotte, N.C., Dec. 18 - MoneyGram International, Inc. investor Blum LP, in a Dec. 17 letter to the company's board, said it is reserving judgment on Euronet Worldwide Inc.'s proposed acquisition but cautioned the board that it has the duty "to negotiate in good faith with Euronet to reach a definitive conclusion on the comparative value proposition to shareholders."

Blum noted that "the onerous restriction of a standstill agreement is antithetical to the goal of shareholder value maximization during a proposed negotiation process."

Blum urged the company to remove the standstill agreement and "enter into discussions with Euronet to secure the best possible value for MoneyGram shareholders."

The investor asked MoneyGram to respond by Dec. 21.

Euronet said it welcomes the views of all MoneyGram shareholders and is pleased that Blum Capital "echoed Euronet's call for MoneyGram to negotiate" with Euronet "in good faith consistent with their fiduciary duty."

"We believe we have already made a compelling offer and we remain willing to consider raising it should MoneyGram provide non-public information that would justify an increase," Euronet said in its schedule 13D SEC filing. According to Euronet, the ball is now in MoneyGram's court.

It was previously reported that Euronet offered to acquire MoneyGram in an all-stock transaction valued at $1.65 billion, or $20 per MoneyGram share, with a fixed exchange ratio of 0.6179 of a Euronet common share for each share of MoneyGram.

Euronet offered interim financing, noting its $250 million of cash in the bank along with additional funds available from Euronet's existing financing arrangements.

While MoneyGram said it would discuss this latest proposal subject to the execution of a mutual confidentiality and standstill agreement, Euronet said it would not discuss the proposed acquisition under those conditions.

MoneyGram had hired JPMorgan to complete a strategic review of MoneyGram's payment systems business, according to a company statement.

MoneyGram is a payment services company located in Minneapolis.

Based in Leawood, Kan., Euronet provides products and services for electronic payments.

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