KKR picks ex-MCI chief for First Data
NEW YORK: Kohlberg Kravis Roberts on Tuesday named Michael Capellas, the former chief executive of MCI, to lead First Data after the $25.6 billion buyout of the company, the largest processor of credit-card payments.
Capellas, 52, was MCIs chief executive from 2002 until the companys acquisition in 2006 by Verizon Communications. Before that job, he led Compaq Computer. Capellass priorities at First Data include expanding internationally and strengthening ties with customers, the company said.
KKR, whose funds control companies with more than $100 billion in annual revenue and 560,000 employees, said April 2 that it would pay $34 in cash for each First Data share, making it the largest leveraged buyout after the $31.8 billion takeover of TXU of Dallas. Capellas will replace Henry Duques after the acquisition, which KKR expects to finish at the end of the third quarter.
“Michael has a strong track record for vision, innovation and value creation,” Scott Nuttall of KKR said. “Were confident that he will deepen customer relationships.”
Duques, 64, put First Data up for sale seven months after spinning off its Western Union money-transfer unit and failing to find a successor to replace him. Duques had turned the company over to Charles Fote in 2002, then returned after the stock slumped and Fote resigned in November 2005. When he returned, Duques said he would stay for only two years.
In his first tenure at the company, Duques presided over First Datas spinoff in 1992 from American Express. He also increased revenue and market capitalization sevenfold during his decade as chief executive.
Capellas led MCI out of a bankruptcy. The phone company was forced into a reorganization after an $11 billion fraud. Capellas sold MCI to Verizon for $8.5 billion. Capellas has a track record of selling the firms he leads. He sold Compaq to Hewlett-Packard in 2002.
Since 2006, Capellas has been an adviser to Silver Lake Partners, the largest buyout firm to focus on technology. Silver Lake said in January that it would raise as much as $10 billion for a new fund.
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