Fitch Ratings Affirms First Data's S-T Rating At 'F1'.

Business Editors

NEW YORK--(BUSINESS WIRE)--April 2, 2003

Fitch Ratings has affirmed First Data Corp.'s (FDC) 'F1' short-term rating following the announcement of the company's pending acquisition of Concord EFS (Concord). The rating applies to FDC's $1.5 billion commercial paper

Today, FDC announced a definitive agreement to merge with Concord in an all stock transaction valued at approximately $7 billion, representing a fixed exchange ratio of 0.4 FDC common shares for each Concord share. Fitch estimates that FDC will acquire approximately $1 billion in cash as a result of this transaction. Importantly, credit protection metrics should remain strong, with debt/EBITDA forecasted to be 1.2 times (x) in 2003 on a pro-forma basis and free cash flow (FCF) in excess of $1.5 billion. The transaction is subject to both shareholder and regulatory approvals and is expected to close in the third quarter of 2003.

The combined company is expected to generate annual revenue of approximately $10 billion and realize cost synergies of about $230 million annually by 2005. Fitch believes that the addition of Concord's assets to FDC's product profile will enhance the company's position in the marketplace, particularly in the merchant services segment, increasing its market share for debit-card and ATM transaction fees. In particular, the combination would boost FDC's share of Visa and MasterCard credit and debit card processing for merchants.

FDC's total debt of $3.2 billion as of year-end 2002 was relatively flat compared to $3.1 billion as of fiscal year end Dec. 31, 2001. At the end of 2002, $572.7 million of debt was short-term, which primarily consisted of $349.9 million in CP and $200 million in 6 6/8 notes due in 2003. The CP and ECN programs are supported by a $1.1 billion revolving credit facility, expiring on Nov. 3, 2005. In addition, FDC had $250 million of uncommitted bank credit lines with no borrowings as of Dec. 30, 2002. Maturities of long-term debt in the near term are manageable. Liquidity is also supported by strong FCF generation, as FDC continues to be strong at $1.4 billion for fiscal year 2002. Approximately half of FCF was used for acquisitions and $850 million for share repurchases during fiscal year end 2002. On May 8, 2002, an additional $500 million was approved for stock repurchases of which over $450 million remained as of year-end 2002. Typically, FDC has funded share repurchases through FCF.

The rating continues to reflect FDC's leading position in third-party processing of credit cards, merchant transactions and payment services, allowing the company to maintain strong cash flow and a conservative financial profile. FDC's strategy is to generate recurring revenue by developing long-term contractual relationships with clients who have decided to outsource various transaction and information processing services. In Western Union, a non-bank, consumer-to-consumer business, FDC has a strong established brand, and an extensive domestic and growing international agent network. Fitch expects that FDC's size and market position will help the company remain among the top payment processing firms. Also considered are increased regulation and competition for the payment services segment (Western Union), the potential for additional fines resulting from state investigations into the company's compliance with certain rules and regulations established by the Federal Bank Secrecy Act and USA Patriot Act, the potential consolidation within FDC's customer base and competitive pricing pressures in the credit card and transaction processing industries. FDC will need to retain its larger and higher volume customers in order to maintain its own current economies of scale.