A.I.M. Value Line Stocks

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CE put itself up for sale? Wonder if I should bail now or add to? Thoughts?

http://quote.bloomberg.com/fgcgi.cgi?T=marketsquote99_relnews.ht&s=APmw0wRRiQ29uY29y

03/10 01:46
Concord EFS Seeks Up to $6 Bln Sale as Stock Drops, People Say
By Michael Nol

Memphis, Tennessee, March 10 (Bloomberg) -- Concord EFS Inc., owner of the largest U.S. network of automated teller machines, put itself up for sale for as much as $6 billion after the company's shares dropped 69 percent in the past year, people familiar with the situation said.

Concord, whose Star Systems Inc. connects the ATMs of banks such as Wells Fargo & Co. and Bank One Corp., hired Goldman Sachs Group Inc. to find a buyer, the people said. Potential purchasers include First Data Corp., the world's biggest credit-card processor, Automatic Data Processing Inc., the world's biggest paycheck issuer, Electronic Data Systems Corp., the second-largest seller of computer services, Visa International, or Total System Services Inc., analysts said.

Profit growth at Concord, also the fourth-biggest credit card processor, has slowed amid declining prices and increased competition. Last year, net income grew 15 percent, down from 34 percent in 2001. The company last month named former Visa executive Bond Isaacson co-chief executive with current CEO Dan Palmer, scrapping a plan to promote President Ed Labry. It also replaced Palmer as chairman with Richard Kiphart, 61, a William Blair & Co. investment banker.

``Management has had a tough go of it,'' said Adam Frisch, an analyst at UBS Warburg He rates the company a `buy.'' ``There's been a lot of turmoil, and investor confidence has been rattled.''

Concord EFS spokeswoman Melinda Mercurio declined to comment, as did First Data spokeswoman Staci Busby and Goldman spokesman Lucas Van Praag.

Visa Has `No Interest'

Visa spokesman John Abrams said the world's largest credit- card company had ``absolutely no interest'' in Memphis, Tennessee- based Concord. Total Systems spokesman Eric Bruner declined to comment. Spokesmen from Electronic Data Systems and Automatic Data Processing didn't return telephone calls.

Concord said last month its 2003 earnings would grow 10 to 16 percent -- less than half the pace of 2001 -- as competition from companies such as First Data and Visa forced it to lower fees it charges banks and stores to process customer purchases. The company's fourth-quarter profit margin fell to 20 percent from 26 percent in the same period a year earlier.

Concord shares closed Friday at $10.35. The shares have slumped to their lowest level since April 2000 on concern Visa's Interlink network will take over Star's agreements that expire next year with clients including Wells Fargo and Bank One and Wachovia Corp.

Kiphart, the new chairman, has been a Concord EFS director since 1997 and is head of corporate finance at William Blair, which took the company public in 1984.

William Blair is the company's third-biggest stockholder with a 3.5 percent stake, according to Bloomberg data.


Keith