The merger of local business Computer Services, Inc. with Centerbridge Partners LP and Bridgeport Partners that was announced on Aug. 22 was finalized Nov. 9 with the approval of CSI shareholders.
The acquisition was closed in an all-cash transaction valued at about $1.6 billion with a purchase price of $58 per share.
With the completion of the acquisition, CSI became a private company and its common stock ceased trading, no longer listed on the OTCQX market.
David Culbertson, the CEO and president of CSI, said that following the approval of the shareholders, the companies worked to close the deal.
“Which is, basically, the movement of money,” he said. “That happened on the 15th, and I know some who have already received it.”
CSI will retain its name and Paducah location, and all workers will remain with the company.
“The gist of it is that we, operating as a private company, will have an opportunity to advance more quickly,” he said. “We’re going to accelerate some of the strategies that we put into place several years ago, really, including becoming more aggressive as it relates to acquisitions. So, we will be acquiring adjacent businesses.
“We’re going to be able to expand organically because of the support that we have with our new partners. It’s really a very exciting time to be part of CSI and be part of this community of Paducah because we are staying in Paducah. There are no layoffs as a result of this. In fact, we are aggressively hiring.”
Culbertson said one of the main concerns was making sure the CSI shareholder got the best value possible.
“Given the current environment, it looks like it was just very fortuitous that we picked the time that we did,” he said. “The rest of the market is struggling, and with inflation where it’s at.
“I feel like we’re very fortunate. We chose this path, we chose the right partner, we have an opportunity to accelerate going forward and, ultimately, our shareholders got a big win.”
Computer Services, Inc. delivers core processing, digital banking, managed cybersecurity, cybersecurity compliance, payments processing, print and electronic document distribution and regulatory compliance solutions to financial institutions and corporate customers, both foreign and domestic.
“We provide the technology that community banks utilize that allow them to compete with the large national brands,” Culbertson said. “There are almost 5,000 community banks across the country.
“But, in addition to that, we also deliver services to adjacent industries, like money service industries, insurance and logistics, and we do that with our compliance groups. We have some Fortune 50 companies that are customers of ours as well.”
Centerbridge Partners LP is a private investment management firm employing a flexible approach across investment disciplines — private equity, private credit and real estate — in an effort to develop the most attractive opportunities for our investors. The firm was founded in 2005.
Bridgeport Partners is a private investment firm that invests proprietary capital and partners with strategic sources of capital with a long-term orientation to support management teams and companies through industry and economic cycles.
Culbertson called the path toward the merger of the three companies “an interesting process.”
“You get to meet so many people because you’re pitching this idea to a lot of different people,” he said. “From the very first call, I was hoping that Centerbridge and Bridgeport were going to be the group that had the winning bid.
“The connection was there, the commitment to community is there, the realization of the opportunity was there. They engaged consultants who know our space very, very well. It was just perfectly executed from their standpoint and I was very thankful that they had the best offer for our shareholders.”
Over the next two weeks, CSI will be finalizing its board of directors makeup. An announcement regarding that is expected the week after Thanksgiving.
Bridgeport founder Frank Martire will serve as the chairman of the CSI board, and Culbertson and former CEO and board chairman Steve Powless will remain on the board.
Additions to the board include senior managing director Jared Hendericks and managing director Ben Jaffe, both of Centerbridge.
“(Keeping Culbertson and Powless) is a realization that continuity is important and that culture is important,” Culbertson said. “Keeping Steve on the board — I wanted that, but so did they, so it worked out great.”
Culbertson said little else will change with the company.
“We’re still committed to Paducah and the community,” he said. “I’m a big fan of our United Way in Paducah; CSI has historically been one of the largest contributors. That’s going to continue.
“We’re excited about (the merger), and just keep watching because I expect the CSI that people were prone to know and love — the culture of CSI is not changing that much. The speed at which we execute will.”