Private equity firm GTCR LLC agreed to buy a majority stake in Worldpay, the Fidelity National Information Services Inc. unit that handles card payments for businesses all over the world, in a deal valuing the target at $18.5 billion.

FIS will receive upfront, net proceeds of about $11.7 billion and retain a non-controlling 45% ownership interest in the new standalone joint venture, according to a statement Thursday. The valuation includes $1 billion contingent on returns realized by GTCR.

The deal is a part of a turnaround plan crafted by Stephanie Ferris, FIS’s newly installed chief executive officer. Ferris has argued that the merchant business — which FIS bought just four years ago for $41 billion — has lost market share to traditional rivals and upstarts alike because it’s been tethered to FIS and largely unable to do additional mergers and acquisitions that would give it better scale.

The transaction includes a commitment that GTCR will provide as much as $1.25 billion in additional funding for Worldpay to do deals, Ferris told investors on a conference call Thursday.

“This new separation path for Worldpay positions Worldpay for immediate and long-term success,” Ferris said. “It will allow Worldpay to focus on the distinct needs of its payments clients.”

The sale is a departure from FIS’s initial plans for the business. When Ferris first announced that FIS was weighing a divestiture earlier this year, she said the company was focused on a spinoff, and the company booked a $17.6 billion writedown on the business.

“The board and management team conducted a rigorous evaluation process determining that this new separation path is in the best interest of FIS shareholders, and supersedes the value creation potential of a spinoff,” Ferris said.

The cash proceeds will allow FIS to pay down debt and return additional capital to shareholders, and the company will also use it for general corporate purposes.

FIS shares fell 2.6% to $58.25 at 9:31 a.m. in New York, extending this year’s decline to 13%. The S&P 500 Index is up 15% this year.

Worldpay Volume

Worldpay is one of the world’s largest so-called merchant acquirers, which help businesses of all sizes accept electronic forms of payment. The company’s volume last year was $2 trillion.

Founded in 1980, Chicago-based GTCR manages more than $35 billion in equity capital and focuses on sectors including financial services and technology. The private equity firm in May closed a new fund with $11.5 billion in commitments.

GTCR said in a separate statement that it received debt financing from JPMorgan Chase & Co. and Goldman Sachs Group Inc., while Citigroup Inc., Wells Fargo & Co., Deutsche Bank AG and UBS Group AG provided both debt financing and financial advice.

Goldman Sachs, JPMorgan and Centerview Partners advised FIS on the deal.

–By Jenny Surane (Bloomberg)