Payment technology and services provider, EVO Payments has announced that it has received an $150 million investment from private equity Madison Dearborn Partners, enabling the company to navigate global COVID-19 headwinds
The firm outlined it’s ‘closely monitoring COVID-19’ and its impact on the firm’s ongoing business. This comes as little surprise given the company’s diversified mix of merchants across Europe and North America, with many operating in markets that are subject to broad governmental restrictions on movement and commerce.
The company has undertaken a strategic response as it seeks to align its cost structure and cash flows with the expected near-term decline in revenues caused by the crisis.
These actions include a series of initiatives to reduce fixed costs up to 20% for the remainder of fiscal 2020, and further lower EVO capital expenditures by up to 75%. Such reductions will depend on the pace in which economic activity returns.
James G. Kelly, EVO’s Chief Executive Officer commented: “We have taken decisive measures to ensure our business is best positioned to continue to serve our valued customers throughout this global pandemic.
“The long-term fundamentals of EVO’s business remain strong and, as the economy recovers, we believe these actions will support EVO’s continued growth through the execution of our strategic plan.”
A portion of the proceeds from MDP’s investment will be used to pay down EVO’s revolver borrowings, reducing EVO’s pro forma leverage ratio as of December 31, 2019 to 3.3x net debt to Adjusted EBITDA.
Any remaining proceeds are expected to be used to fund potential future investment opportunities.
Ray Sidhom, Chairman of EVO’s Board of Directors, added: “We value our long-term relationship with MDP, and we welcome their strong and demonstrated commitment to the future of EVO as it navigates this global pandemic.”
