Private equity circles MoneyGram: sources

Fri Jun 28, 2013 11:12am EDT
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By Greg Roumeliotis and Soyoung Kim

NEW YORK (Reuters) - Carlyle Group LP (CG.O: Quote) and TPG Capital LP are among private equity firms vying for MoneyGram International Inc (MGI.O: Quote), the world's second-largest money transfer company, four people familiar with the matter said this week.

Bain Capital LLC and GTCR LLC are also participating in the auction for MoneyGram, which is being run by Bank of America Corp (BAC.N: Quote) and is currently in its second round of bidding, the sources said.

Two industry players are also in contact with MoneyGram about a potential takeover, one of the sources said. The identity of these parties could not be learned.

MoneyGram, Bank of America, Carlyle, TPG, Bain and GTCR declined to comment.

MoneyGram shares jumped 2.5 percent on the report, giving the company a market value of $1.3 billion. Through Thursday, the shares had risen 65 percent this year, compared with a 13 percent rise for the Nasdaq Composite Index .IXIC.

The news service Dealreporter reported on June 18 that MoneyGram was exploring a sale. The company's stock was already on the rise on expectations shareholders would get more of the company's cash flow as dividends.

With more than 321,000 locations in retailers, post offices and banks in 198 countries and territories, MoneyGram is second only to Western Union Co (WU.N: Quote) among money transfer providers.

MoneyGram started as a small money order company in Minneapolis in 1940 and now boasts more than twice the locations of McDonald's Corp (MCD.N: Quote), Starbucks Corp (SBUX.O: Quote), Subway and Wal-Mart Stores Inc (WMT.N: Quote) combined.   Continued...