WEX Agrees To Buy Electronic Funds Source For $1.1 Bln Cash, 4.0 Mln Shares

(RTTNews) - WEX Inc. (WEX), a provider of corporate payment solutions, said it has entered into a definitive agreement to acquire Electronic Funds Source LLC or EFS for a total consideration of $1.1 billion in cash and 4.0 million shares of common stock to be issued to investment funds affiliated with Warburg Pincus, EFS' current owner.

The acquisition is expected to be immediately accretive to adjusted net income. The company expects to realize run-rate synergies of $25 million over a three year period, excluding one-time integration costs. It estimates to realize $275 million in present value of tax benefits.

According to WEX, EFS' strong track record and broad customer acceptance in mid- and large-sized over-the-road fleet segments is an ideal complement.

The combined company would serve the needs of all sizes and types of fleets by drawing on strengths from both companies' offerings to provide a more efficient, more comprehensive and better-integrated solution to all customers, WEX added.

EFS' sophisticated OTR platform adds important functionality in controls, permitting, fuel price analytics, mobile account maintenance and strong acceptance in Canada.

The combination will further diversify WEX's earnings and help to reduce its exposure to fuel price sensitivity.

The transaction has been unanimously approved by the WEX board of directors.