Backed by private equity firm GTCR, Paya is a pure-play payments platform that offers services to customers in sectors including government, business-to-business (B2B), utilities, non-profit, and healthcare
Canadian fintech company Nuvei has signed a definitive agreement with US-based integrated payment and commerce solutions provider Paya to acquire the latter in an all-cash deal worth around $1.3bn.
As per the terms of the agreement, shareholders of the Atlanta-based publicly-listed firm will be paid $9.75 per share in cash by Nuvei.
Under the terms of the deal, Nuvei is anticipated to launch a tender offer to buy all the shares of the American firm. The tender offer’s closing is subject to expiration or termination of the antitrust waiting period, and other conditions.
Backed by private equity firm GTCR, Paya is a pure-play payments platform that offers services to customers in sectors including government, utilities, business-to-business (B2B), non-profit, and healthcare.
Paya was acquired by GTCR in 2017 and became a NASDAQ-listed public company in October 2020.
The company is said to process more than $40bn of annual payment volume across credit or debit card, automated clearing house (ACH), and cheque.
Paya CEO Jeff Hack said: “We are pleased to have reached this transaction with Nuvei, which is a testament to the incredible talent at Paya, and will deliver immediate and significant cash value to Paya shareholders.
“We continue to see strong momentum in our high-growth and underpenetrated middle market partners in durable end-markets, and believe that Nuvei’s resources will enable us to continue our mission of solving complex business problems with easy-to-use payment solutions.”
Through the acquisition, Nuvei is expected to capitalise on the domestic and global software-led market opportunity offered by Paya’s end-to-end commerce solutions and software interfaces with over 300 independent software vendor (ISV) platforms.
Besides, the Canadian fintech firm is anticipated to combine Paya’s complementary integrated payment capabilities with its global technology platform to provide improved client offerings and unlock additional growth opportunities.
Nuvei chair and CEO Philip Fayer said: “The proposed acquisition of Paya is a powerful next step in the evolution of Nuvei, creating a preeminent payment technology provider with strong positions in global eCommerce, Integrated Payments and business-to-business (B2B).
“The proposed transaction will combine two people-first, technology-led, high-growth payment platforms. It will accelerate our integrated payment strategy, diversify our business into key high-growth non-cyclical verticals with large addressable end markets and enhance the execution of our growth plan.”
The deal is expected to be financed by Nuvei through a combination of cash on hand, an existing credit facility, and a new committed first lien secured credit facility of $600m.
According to Nuvei, the proposed deal is expected to generate estimated run-rate cost synergies of up to $21m within 24 months and offer revenue synergy upside potential.
The transaction is expected to be complete by the end of Q1 2023.