GTCR Announces Acquisition of Sage Payment Solutions

by PaymentsJournal 0

Corporate carve-out ofleading provider of payment processing and merchant acquiring solutions

CHICAGO, June 2, 2017GTCR,a leading private equity firm, announced today that it has entered into adefinitive agreement to acquire Sage Payment Solutions, Inc. (“SPS” or the“Company”) for $260 million. SPS, headquartered in Reston, Virginia, is aleading provider of payment processing and merchant acquiring solutions inNorth America. GTCR is acquiring SPS from The Sage Group plc (LSE: SGE)(“Sage”), a global provider of integrated accounting, payroll and paymentsolutions headquartered in the UK. GTCR is partnering with SPS management topursue organic growth initiatives and fund future acquisitions in the paymentprocessing industry. To support this strategy, GTCR has committed up to $350million of equity capital to the platform. The transaction is expected to closein the third quarter following receipt of regulatory approvals and otherconsents.

SPS provides credit card,ACH, check, gift and loyalty card processing services to small and medium-sizedbusinesses (“SMBs”) in the United States and Canada. SPS’s payment solutionsintegrate with merchants’ business management software solutions and enablethem to securely accept electronic payments through multiple channels,including card-present, e-Commerce and mobile. Through the Company’s SagePayment Solutions EFT subsidiary, SPS offers specialized ACH processingservices to merchants, processors and other businesses. SPS serves adiversified client base of approximately 100,000 SMBs including healthcareproviders, non-profit and faith-based organizations, and accounting softwarecompanies.

In conjunction with thetransaction, SPS and Sage entered into a strategic alliance to facilitateongoing cooperation serving merchants and partners. Under the terms of thisalliance, SPS will be the preferred provider of merchant processing services toSage clients in the United States. SPS and Sage will work to provide a superiorpayments experience to mutual customers through seamless technology integrationand exceptional service. SPS and Sage have pledged to work together to maintainthe integration of technology and systems. Sage will retain a financialinterest in SPS in addition to the strategic alliance and other commercialagreements between the parties.

“We are delighted topartner with the SPS management team at this exciting time in the Company’sevolution,” said Collin Roche, Managing Director at GTCR. “SPS has a leadingplatform with robust software integrations in attractive end markets. We intendto invest further in the technology and offer additional innovative solutionsto SPS customers and partners. GTCR’s long history of investing in payments andextensive experience in corporate carve-outs provides us with a differentiatedperspective on the Company, and we are excited to bring significant resourcesand expertise to help fuel the next phase of SPS’s growth.”

Aaron Cohen, ManagingDirector at GTCR, continued: “We are excited to acquire SPS and work aspartners with Sage on a go-forward basis. We believe the Company is wellpositioned to continue its growth and success within the rapidly evolving areaof integrated payments, and we look forward to supporting greater organicgrowth and expansion through acquisition.”

Fully committed financingfor the transaction has been arranged by GTCR and funded by Antares, Ares,Jefferies, Barclays and NXT. Jefferies served as financial advisor. Latham& Watkins and Paul Hastings served as legal counsel.

About GTCR

Founded in 1980, GTCR is aleading private equity firm focused on investing in growth companies in theFinancial Services & Technology, Healthcare, Technology, Media & Telecommunicationsand Growth Business Services industries. The Chicago-based firm pioneered TheLeaders Strategy™ – finding and partnering with management leaders in coredomains to identify, acquire and build market-leading companies throughtransformational acquisitions and organic growth. Since its inception, GTCR hasinvested more than $12 billion in over 200 companies. For more information,please visit www.gtcr.com.

About SPS

Sage Payment Solutions(“SPS”) provides business technology solutions to global small andmedium sized companies, in every industry, that enables businesses to get paid,make payments and manage their money—simply and securely. SPS’ comprehensivesuite of products and services deliver easy to use technology for every stageof a client’s lifecycle. For more than 20 years, SPS has been dedicated to thesuccess of its clients, providing a seamless connection with, and between,business applications; offering valuable business insights that enable clientsto run their businesses smarter, so they can run their businesses better. Formore information, please visit us at www.sage.com/us/payment-processing.

About Sage

Sage is the market and technology leader forintegrated accounting, payroll and payment systems, supporting the ambition ofentrepreneurs and business builders. Today, business builders measure successin strong relationships, partnerships, and communities. It‘s why Sage helpsdrive today’s business builders with the most intelligent and flexiblecloud-enabled software, support and advice to manage everything from money topeople. Daily, more than 13,000 Sage colleagues in 23 countries work with athriving global community of over 3 million entrepreneurs, business owners,tradespeople, accountants, partners and developers to champion the success ofbusiness builders everywhere. And as a FTSE 100 business, we are passionateabout doing business the right way, supporting our local communities throughthe Sage Foundation. Sage – the market and technology leader for integratedaccounting, payroll and payment systems, powered by the cloud and supportingthe ambition of the world’s entrepreneurs and business builders. Because whenbusiness builders do well, we all do. For more information, visit www.sage.com.