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EXHIBIT 19
[XXXXXX XXXXXXX LETTERHEAD]
May 12, 1998
Board of Directors
MoneyGram Payment Systems, Inc.
Park 00 Xxxx Xxxxx X
Xxxxxx Xxxxx, XX 00000
Members of the Board:
We understand that MoneyGram Payment Systems, Inc. ("MoneyGram" or the
"Company"), Viad Corp. ("Viad") and Pine Valley Acquisition Corporation, a
wholly owned subsidiary of Viad, ("Acquisition Sub") have entered into an
Agreement and Plan of Merger dated April 4, 1998 (the "Merger Agreement"), which
provides, among other things, for (i) a tender offer by Acquisition Sub (the
"Tender Offer") for all outstanding shares of common stock, par value $.01 per
share (the "Company Common Stock") of the Company for $17.35 per share net to
the seller in cash and (ii) the subsequent merger (the "Merger") of Acquisition
Sub with and into the Company. Pursuant to the Merger, the Company will become a
wholly owned subsidiary of Viad, and each outstanding share of Company Common
Stock, other than shares held in treasury or held by Viad or any affiliate of
Viad or as to which dissenters' rights have been perfected, will be converted
into the right to receive $17.35 per share in cash. The terms and conditions of
the Tender Offer and the Merger are more fully set forth in the Merger
Agreement.
You have asked for our opinion as to whether the consideration to be
received by the holders of shares of Company Common Stock pursuant to the Merger
Agreement is fair from a financial point of view to such holders.
For purposes of the opinion set forth herein, we have:
(i) reviewed certain publicly available financial statements and other
information of MoneyGram;
(ii) reviewed certain internal financial statements and other
financial and operating data concerning MoneyGram prepared by the
management of MoneyGram;
(iii) analyzed certain financial projections prepared by the
management of MoneyGram;
(iv) discussed the past and current operations and financial condition
and the prospects of MoneyGram with senior executives of MoneyGram;
(v) reviewed the pro forma impact of the Merger on Viad's earnings per
share;
(vi) reviewed the reported prices and trading activity of the Company
Common Stock;
(vii) compared the financial performance of the Company and the prices
and trading activity of the Company Common Stock with that of certain other
comparable publicly-traded companies and their securities;
(viii) reviewed the financial terms, to the extent publicly available,
of certain comparable acquisition transactions;
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(ix) participated in discussions and negotiations among
representatives of MoneyGram and Xxxx and their financial and legal
advisors;
(x) reviewed the draft Merger Agreement and certain related documents;
and
(xi) performed such other analyses and considered such other factors
as we have deemed appropriate.
We have assumed and relied upon without independent verification the
accuracy and completeness of the information reviewed by us for the purposes of
this opinion. With respect to the financial projections, we have assumed that
they have been reasonably prepared on bases reflecting the best currently
available estimates and judgments of the future financial performance of the
Company. We have not made any independent valuation or appraisal of the assets
or liabilities of the Company, nor have we been furnished with any such
appraisals. Our opinion is necessarily based on economic, market and other
conditions as in effect on, and the information made available to us as of, the
date hereof.
We have acted as financial advisor to the Board of Directors of MoneyGram
in connection with this transaction and will receive a fee for our services. In
the past, Xxxxxx Xxxxxxx & Co. Incorporated and its affiliates have provided
financial advisory and financing services for MoneyGram and have received fees
for the rendering of these services.
It is understood that this letter is for the information of the Board of
Directors MoneyGram and may not be used for any other purpose without our prior
written consent, except that this opinion may be included in its entirety in any
filing made by the Company in respect of the transaction with the Securities and
Exchange Commission.
Based upon and subject to the foregoing, we are of the opinion on the date
hereof that the consideration to be received by holders of shares of the Company
Common Stock pursuant to the Merger Agreement is fair from a financial point of
view to such holders.
Very truly yours,
XXXXXX XXXXXXX & CO. INCORPORATED
By: /s/ XXXXX X. XXXXXXXXX
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Xxxxx X. Xxxxxxxxx
Managing Director
