WEX to Buy Electronic Funds Source
October 19 2015 - 9:40AM
Dow Jones News
Corporate-payment company WEX Inc. on Monday said it agreed to
buy rival Electronic Funds Source LLC from private-equity firm
Warburg Pincus LLC for about $1.4 billion in cash and stock.
WEX will pay $1.1 billion in cash and issue 4 million common
shares, which will result in investment funds affiliated with
Warburg Pincus becoming WEX's largest shareholder. Warburg Pincus
managing director Jim Neary will join WEX's board once the
transaction is complete.
Maine-based WEX, which has seen a deceleration in fuel
transaction growth, said the deal will immediately add to earnings
and help reduce WEX's exposure to fuel-price sensitivity. WEX
operates two segments—fleet-payment solutions and non-fleet-payment
solutions—and has faced headwinds from sharply lower energy
prices.
In its most recent quarter, WEX reported a profit of $26.5
million, down 39% from a year earlier. The company in July cut its
revenue guidance for the year amid lower projected fuel prices.
The EFS deal follows WEX's $80 million acquisition last week of
Benaissance, a move to expand in the health-care-payments
space.
Write to Lisa Beilfuss at lisa.beilfuss@wsj.com
Subscribe to WSJ: http://online.wsj.com?mod=djnwires
(END) Dow Jones Newswires
October 19, 2015 09:25 ET (13:25 GMT)
Copyright (c) 2015 Dow Jones & Company, Inc.
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