MoneyGram International Inc. (MGI) posted its biggest two-day rally since July 2009 after announcing a restructuring that would include Goldman Sachs Group Inc. (GS) increasing its stake in the money-transfer company.
Shares of Minneapolis-based MoneyGram advanced 20 cents, or 6.6 percent, to $3.25 at 4:15 p.m. in New York Stock Exchange composite trading and earlier climbed as much as 9.5 percent, on top of yesterday’s 14 percent gain.
Goldman Sachs would receive $77.5 million in cash and additional preferred shares that may be equal to a 30 percent equity stake if converted to common stock, MoneyGram said yesterday in a statement. Boston-based private-equity firm Thomas H. Lee Partners LP and its co-investors would get $140.8 million in cash and own about 55 percent of the common shares. The deal may close in mid-2011, MoneyGram said.
“This transaction is beneficial to current and future shareholders,” Chief Executive Officer Pamela H. Patsley, 54, said yesterday in a conference call with analysts. “It increases the attractiveness of our common stock by removing the uncertainty surrounding the current capital structure.”
MoneyGram, the second-largest money-transfer firm after Western Union Co. (WU), sold preferred stock to THL and New York- based Goldman Sachs in 2008 after reporting declines in investments linked to the U.S. housing market.
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