CheckFree to Acquire American Payment Systems to Establish Leadership Position in the Walk-In Bill Payment Market
Wednesday December 17, 8:30 am ET
ATLANTA, Dec. 17 /PRNewswire-FirstCall/ -- CheckFree Corporation (Nasdaq: CKFR - News), the leading provider of financial electronic commerce services and products, today announced an agreement with UIL Holdings Corporation (NYSE: UIL - News) to acquire American Payment Systems, Inc. (APS), a leading U.S. provider of walk-in bill payment services.
Based in Wallingford, Connecticut, APS provides walk-in bill payment services through an extensive national network of more than 8,000 retail and agent locations, which reaches 70 percent of consumers in the top 75 U.S. metropolitan areas. Today, APS enables 7 million households to pay for services in-person. The company serves hundreds of billers with contracted payment services and manages a growing network of non-contracted billers for electronic transaction processing. For 2003, APS expects to process nearly 120 million payments.
"This new bill payment channel significantly extends our reach in electronic billing and payment. CheckFree is the leading provider of electronic billing and payment services, but we do not reach the 20 percent of the U.S. population who pay their bills in person in retail locations around the country," said Pete Kight, chairman and chief executive officer of CheckFree. "Combining APS' retail footprint with our current electronic billing and payment offering greatly enhances our value proposition to billers. In addition, APS' walk-in bill payment transactions leverage the efficiencies and economies of scale delivered through our end-to-end payment processing infrastructure."
Under the terms of the agreement, and pending receipt of regulatory approvals and satisfaction of customary closing conditions, CheckFree will pay approximately $110 million in cash for the outstanding stock of APS. The transaction is expected to close before the end of CheckFree's 2004 fiscal year, which closes on June 30, 2004. CheckFree will provide specific financial guidance for this transaction upon closing.
As part of the deal, CheckFree also acquires APS' prepaid stored value MasterCard business, which leverages the same retail network to provide APS agents with an additional payment service to meet the needs of consumers who may not have an established banking relationship. CheckFree is not acquiring APS' prepaid telephony business, which is managed via a joint venture and is not aligned strategically with CheckFree's goals for the acquisition. The lines of business that CheckFree is acquiring have combined annual revenue, net of certain agent commissions, of more than $40 million per year. . .
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