Palamon agrees to sell Retail Decisions for $205 million

Palamon Capital Partners (“Palamon”), one of Europe’s leading mid-market private equity firms, has agreed the sale of Retail Decisions (“ReD”) to ACI Worldwide for $205 million, subject to regulatory approvals. The sale will result in total Sterling investment returns for Palamon of 2.5 times invested capital.

ReD is a leading global provider of payment fraud prevention technology and services to merchants, card issuers, acquirers and processors. The Company’s flagship product ReD Shield®, a real-time, on-line fraud prevention solution, is used by large e-commerce and multi-channel merchants in North America, Europe, Asia-Pacific and Latin America, to boost on-line revenues while reducing fraud losses. Headquartered in the UK, ReD is a leader in several key country markets, including the US where it screens over 25% of e-commerce transactions.

Palamon acquired ReD in a take-private in December 2006 alongside co-investors, Morgan Stanley Alternative Investment Partners and AlpInvest. At the time of its acquisition, in addition to its payments fraud prevention business, ReD operated fuel and gift card businesses in Europe and Australia. Following the global financial crisis, Palamon fully de- levered the company and returned 80% of invested equity through three separate division sales: the UK Fuel Cards business in August 2009, the Australian businesses in September 2010 and the European fuel card business in March 2011. As a final phase of the investment, Palamon devised a strategy to accelerate growth in the remaining payments fraud prevention business focused on strengthening management and committing to significant investment in product innovation and partner channel expansion.

Under the leadership of Paul Stanley, recruited as CEO in mid-2011, ReD launched several innovative solutions such as ReD Fraud Xchange, an on-line platform that enables real-time collaboration between merchants and issuers in the fight against payment fraud, and ReDi, an interactive, self-service business intelligence tool for e-commerce transactions. In parallel, the Company significantly broadened its partner channel across the globe and today has partnership agreements with leading payments companies such as Global Collect, First Data, FIS, EVO Payments, Worldline, Sage Pay, Yapital, PayU and UOLDIVEO.

Fabio Massimo Giuseppetti, Partner at Palamon, commented, “As the largest investment in the Palamon II portfolio, ReD has been a highly successful result for Palamon. Having de- levered the business and returned most of our invested capital through the early divisional divestments, we were able to focus on the “jewel in the crown”; the global fraud prevention business. We successfully delivered on our investment thesis by backing a highly scalable SaaS business model with transaction-based revenue and we are delighted with the results achieved.”

Paul Stanley, CEO at ReD, commented, “We have thoroughly enjoyed working with Palamon and are proud of the results we have achieved together. Their understanding of the e- commerce space combined with their experience in payments and enterprise software was invaluable in establishing ReD as a global leader in fraud prevention. Significant investments in new products and sales channels have further strengthened our global platform and we are well placed to continue delivering strong growth. We look forward to working with ACI Worldwide in the next phase of our development.”

Palamon has successfully invested in the e-commerce and software services space through portfolio companies such as: dress-for-less, one of Europe’s leading on-line fashion retailers; feelunique.com, Europe’s largest premium beauty e-tailer and TeamSystem, a leading Italian SME software provider.

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About ReD

ReD is a world leader in fraud prevention, with solutions that are present at every stage of the payments value chain, supporting merchants and PSPs, issuers and acquirers, processors and switch networks in the fight against fraud. ReD protects billions of transactions across multiple channels and payment types with proprietary technology that is underpinned by world class fraud and risk analysts and pooled data from more than 190 countries. ReD serves customers from multiple sectors and across six continents from offices in Australia, China, Dubai, South Africa, the United Kingdom and the United States, and through partners around the globe.

For more information on ReD refer to www.redworldwide.com