Deluxe Corporation's WAUSAU Financial Systems Acquires First Data's Remittance Processing Business
SHOREVIEW, Minn. - August 16, 2018 - Deluxe Corporation announced today that its WAUSAU Financial Systems subsidiary has acquired the remittance processing business of First Data Corporation. The business is now an integral part of Deluxe Financial Services’ growing suite of Treasury Management Solutions.
The remittance processing business acquired by Deluxe provides a robust suite of services across payment types, as well as image capture software. The solutions are designed to improve operational efficiency, reduce costs, and improve funds availability for financial institutions and corporate clients.
“This is another strategically important acquisition for Deluxe Financial Services as we cement our position as a leading provider of receivables management solutions,” said John Filby, President of Deluxe Financial Services. “This acquisition reinforces our longstanding ‘best-in-class’ brand promise and the ongoing market trend toward outsourcing technology enabled solutions and services to trusted FinTech partners of scale. We remain committed to delivering industry leading receivables management solutions for the most demanding financial institutions and corporate clients in the world.”
The all-cash acquisition was completed for approximately $93 million and was financed through the Deluxe credit facility. This acquisition was first mentioned in Deluxe’s April 26 earnings release, again in a June 18 acquisition update press release and in Deluxe’s July 25 earnings release. Deluxe expects the acquisition to deliver revenue of approximately $10 million in the third quarter and $19 million in the fourth quarter, or $29 million in 2018. The third quarter and full year revenue outlook ranges will be lower than previously communicated by $7 million as a result of the timing of the acquisition closure. The acquisition is expected to be slightly dilutive to Deluxe’s earnings per share for the year.
This acquisition, as well as the acquisitions of WAUSAU, FISC, Data Support Systems, and RDM Corporation that were made over the last four years, is evidence of Deluxe’s strategic commitment to serve commercial financial institutions. Deluxe Treasury Management Solutions allow financial institutions and corporations to accelerate working capital, improve straight-through remittance processing, and drive profitable growth with in-house, hosted or Business Process Outsourcing (BPO) solutions for receivables management, remote capture, payment processing services, and treasury management onboarding.
“This transaction is a win for both First Data and Deluxe,” said Frank Bisignano, Chairman and CEO of First Data. “It is consistent with First Data’s commitment to optimize our portfolio, allowing us to focus on businesses that are core to our growth strategy. As a result of this acquisition, Deluxe will bring together deep industry experience and core offerings in lockbox services and software as a leader in treasury management.”
As part of the agreement, First Data will continue to offer remittance processing services through a referral arrangement with Deluxe.
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