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Paya Holdings (NASDAQ:PAYA) stock surged 25% in Monday premarket trading after Nuvei (NASDAQ:NVEI) agreed to acquire the payment tech for $9.75 per share in cash, or a total consideration of ~$1.3B.
The acquisition will accelerate Nuvei’s (NVEI) integrated payment strategy, and diversify its business into key high-growth non-cyclical verticals with large addressable end markets, NVEI Chair and CEO Philip Fayer said in a statement. Nuvei shares dipped 6.6% in premarket.
“The proposed acquisition of Paya (PAYA) is a powerful next step in the evolution of Nuvei (NVEI), creating a preeminent payment technology provider with strong positions in global eCommerce, Integrated Payments and business-to-business,” he said.
The purchase price represents a 25% premium to Paya’s (PAYA) Jan. 6 closing price and a 30% premium to its 90-day volume-weighted average share price.
Nuvei (NVEI) expects to finance the acquisition with a combination of cash on hand, an existing credit facility, and a new committed $600M first lien secured credit facility.
The deal is expected to result in up to $21M of estimated run-rate cost synergies within 24 months and to add to adjusted EPS in 2023.
An investment fund affiliated with GTCR, which holds ~34% of Paya’s (PAYA) shares outstanding agreed to tender its shares to Nuvei (NVEI).
NVEI’s net leverage ratio — consolidated net debt outstanding to consolidated adjusted EBITDA — is expected to be less than 3x upon closing.
The deal brings to Nuvei (NVEI) businesses in the B2B goods and services, healthcare, non-profit and education, and government and utilities verticals.
Last week, SA contributor Stephen Frampton conducted detailed analysis of Nuvei’s (NVEI) business quality, growth, price, and other factors.
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