Deluxe Corporation (NYSE: DLX) announced Thursday the acquisition of First American Payment Systems. DLX has bought First American for $960 million in cash, depending on certain closing conditions. This deal is beneficial for Deluxe as it will speed up the transformation of the firm into a top payment technology firm as part of its One Deluxe strategy.
This acquisition is a major step towards the achievement of the revolution goal of the firm. The platform of First American will expand DLX's one Deluxe strategy and its overall growth track. The purchase of First American will allow Deluxe to take part in merchant services, a part of the strong material growth payments industry.
Furthermore, this buying decision is expected to create considerable near-term revenue collaborations. The addition of First American’s expandable, omnichannel payment technology and patented back-end processing and payment platform will further expand the Deluxe revolution.
Additionally, First American creates new functionality to assist businesses to combine their platforms and unified payments through powerful yet easy-to-use-to-use point-of-sale solutions. Its technology platform will allow Deluxe to participate in dynamic creativity across its three other industry segments.
Financial Details of Acquisition
It has been disclosed that Deluxe will fund the buying deal with a combination of secured and unsecured debt. The firm is anticipating the net debt to adjusted EBITDA ratio to be nearly 4.0x, with a long-term target leverage ratio of nearly 3.0x, or below. The deal is anticipated to e concluded after the fulfillment of certain necessary conditions.