irst Data Corp. has found a buyer for NYCE, the second largest ATM and PIN debit network in the United States. Metavante Corp., subsidiary of Marshall & Ilsley Corp., plans to acquire NYCE for approximately $610 million in cash. When Metavante owns NYCE, it will directly compete with First Data's STAR network, the largest in the country.

As a majority shareholder in NYCE, First Data will receive approximately $389 million in cash in the transaction. Minority shareholders of the network have the right, within 30 days, to match the terms of the acquisition agreement and acquire First Data's NYCE shares.

First Data owned a 64% stake in NYCE. In April 2003, when First Data proposed a $6.9 billion merger with Concord EFS, Inc., former parent company of the STAR debit network, the U.S. Department of Justice (DOJ), eight states and the District of Columbia raised antitrust concerns and filed a lawsuit seeking to block the deal.

First Data had initially planned to combine STAR with NYCE; however, the DOJ speculated the combined companies would then control nearly 50% of the PIN debit market, potentially reducing competition and increasing prices for debit card holders. In December 2003, First Data settled with the DOJ-obtaining approval to acquire Concord by divesting its share of NYCE.

Metavante sought to purchase NYCE to expand its EFT business and presence in the payment processing business-a PIN debit network is a capability the company currently does not have. The company said NYCE will become a Metavante subsidiary, and will operate as an independent business line, using NYCE's brand name and under NYCE's current senior management team.

Metavante also recently announced plans to acquire two other companies. In preparation for Check 21, Metavante will acquire Advanced Financial Solutions Inc. (AFS), a check-imaging technology provider, and its affiliate, CheckClear LLC, which owns and operates Endpoint Exchange, currently the only operational electronic check image clearinghouse in the United States, and The Medical Banking Exchange, a healthcare payment-processing platform; and it will also acquire The Kirchman Corp., a 36-year old financial services software company.