The Sage Group announces that it has reached a definitive agreement to sell its North American Payments business (“Sage Payment Solutions” or “SPS”) a leading provider of bank card processing, ACH, cheque and gift and loyalty card services in North America, to GTCR. The divested business will continue to be an important partner for Sage and a key provider of integrated payment services to Sage customers.
The enterprise valuation for the transaction is $260m (£202m) of which $240m is payable as cash on completion and the remaining $20m as deferred consideration. As a partner to SPS, Sage will continue to receive a revenue share from joint Sage and SPS customers.
The transaction is subject to certain completion conditions and is expected to complete in the next 3 months. Proceeds will be used to reduce net debt and invested in growth.
SPS’s reported revenue for the year ended 30 September 2016 was £130m with operating contribution of £34m.
Stephen Kelly, Sage’s CEO commented:
“We recently outlined our updated payments and banking strategy which included exiting areas of the payments market where the strategic fit is not as strong as the rest of the business, whilst continuing to build on our growing network of partnerships within the payments and banking sector. This strategy will allow us to enhance and extend our payments capabilities to all our major geographies, strengthening our golden triangle of accounting, people & payroll and payments & banking.
Today’s announcement to sell the SPS business and partner with the divested business backed by GTCR reinforces this strategy, allowing our North American business builders to continue to access their current payments and banking technology, supported by the renewed investment from GTCR.”
This announcement contains inside information. The person responsible for arranging for the release of this announcement on behalf of Sage is Lauren Wholley.
