Wiggin and Dana assists client UIL in closing $110 million sale of American Payment Systems, Inc.

June 23, 2004
June 23, 2004 -- Wiggin and Dana represented UIL Holdings Corporation (NYSE) of New Haven, CT in connection with the sale of its wholly-owned subsidiary American Payment Systems, Inc. to CheckFree Corporation (NYSE) of Norcross, GA, for approximately $110 million in cash.  The parties signed a Stock Purchase Agreement in December 2003 and closed the transaction yesterday after expiration of federal antitrust waiting periods and approvals from several dozen state regulatory authorities.  Morgan Stanley acted as financial advisor to UIL Holdings Corporation.
UIL Holdings Corporation Completes the Sale of American Payment Systems
NEW HAVEN, Conn.--(BUSINESS WIRE)--June 22, 2004--UIL Holdings Corporation (NYSE: UIL) announced today the completion of the sale of its wholly-owned subsidiary American Payment Systems, Inc. (APS), a leading U.S. provider of walk-in bill payment services, to CheckFree Corporation (Nasdaq: CKFR), a provider of financial electronic commerce services and products.
UIL received approximately $110 million in cash, subject to certain post closing adjustments, for the outstanding stock of APS and plans to use the proceeds from the sale to pay down short-term debt and for general corporate purposes. The after-tax gain and after-tax proceeds are expected to be $46 million and $65 million, respectively, net of transaction costs.
"APS grew from a local utility bill payment business to a multi-state leading walk-in bill payment business," commented Nathaniel D. Woodson, UIL's Chairman, President and Chief Executive Officer. "As part of CheckFree's offering of electronic billing and payment products, APS is positioned for even greater success."
UIL Holdings Corporation is the holding company for The United Illuminating Company and several non-utility businesses, including, Xcelecom, Inc., United Capital Investments, Inc. and United Bridgeport Energy, Inc. UI is a New Haven-based regional distribution utility that provides electricity and energy-related services to more than 320,000 customers in municipalities in the Greater New Haven and Greater Bridgeport areas. UIL Holdings World Wide Web address is http://www.uil.com/ and the company is traded on the New York Stock Exchange under the symbol UIL.
UIL Holdings Corporation's Subsidiary, American Payment Systems To Be Acquired by CheckFree Corporation
NEW HAVEN, Conn., Dec 17, 2003 (BUSINESS WIRE) -- Today, UIL Holdings Corporation (NYSE: UIL) announced that it has entered into an agreement to sell its wholly owned subsidiary American Payment Systems, Inc. (APS), a leading U.S. provider of walk-in bill payment services, to CheckFree Corporation (Nasdaq: CKFR), a leading provider of financial electronic commerce services and products.
Based in Wallingford, Connecticut, APS provides walk-in bill payment services through an extensive national network of more than 8,000 retail and agent locations, which reaches 70 percent of consumers in the top 75 U.S. metropolitan areas. Today, APS enables 7 million households to pay for services in-person. The company serves hundreds of billers with contracted payment services and manages a growing network of non-contracted billers for electronic transaction processing. For 2003, APS expects to process nearly 120 million payments.
"UIL has taken great pride in nurturing APS and growing it into the leading service provider that it is today," said Nathaniel D. Woodson, UIL's Chief Executive Officer, Chairman of the Board and President. "We are now pleased that APS will be joining a major player in the electronic financial services industry. This move should strengthen APS' position with its customers and enable CheckFree to profitably expand its service base."
Under the terms of the agreement, and pending receipt of regulatory approvals and satisfaction of customary closing conditions, CheckFree will pay approximately $110 million in cash for the outstanding stock of APS. The transaction is expected to close before June 30, 2004.
"This new bill payment channel significantly extends our reach in electronic billing and payment. CheckFree is a leading provider of electronic billing and payment services, but we do not reach the 20 percent of the U.S. population who pay their bills in person in retail locations around the country," said Pete Kight, Chairman and Chief Executive Officer of CheckFree. "Combining APS' retail footprint with our current electronic billing and payment offering greatly enhances our value proposition to billers. In addition, APS' walk-in bill payment transactions leverage the efficiencies and economies of scale delivered through our end-to-end payment processing infrastructure."
As part of the deal, CheckFree also acquires APS' prepaid stored value MasterCard business, which leverages the same retail network to provide APS agents with an additional payment service to meet the needs of consumers who may not have an established banking relationship. CheckFree is not acquiring APS' prepaid telephony business, which is managed via a joint venture and not aligned strategically with CheckFree's goals for the acquisition. The lines of business that CheckFree is acquiring have combined annual revenue, net of certain agent commissions, of more than $40 million per year.
UIL Holdings plans to use the proceeds from the sale to pay down short term debt and for general corporate purposes. UIL Holdings will provide specific financial guidance for this transaction in the future.
Morgan Stanley in New York acted as investment banker and Wiggin and Dana LLP in New Haven acted as legal counsel to UIL Holdings in this transaction.