Acquisition of largest provider of integrated commerce solutions
establishes Heartland as the leader in the higher-education payments
PRINCETON, N.J.--(BUSINESS WIRE)--
Heartland Payment Systems (NYSE:HPY),
one of the nation's largest payment processors and a leading provider of
merchant business solutions, announced today that it has entered into an
agreement to acquire TouchNet Information Systems, Inc., an integrated
commerce solutions provider to higher-education institutions.
“I am extremely pleased to announce the acquisition of TouchNet, which
is not only Heartland’s largest acquisition to date, but is also an
excellent complement to our existing Campus Solutions business that will
immediately improve our growth profile and contribute to our bottom
line,” said Robert O. Carr, chairman and CEO of Heartland Payment
TouchNet adds over 600 higher education clients serving over six million
students – nearly one-third of the higher-education enrollment in the
United States – to Heartland’s Campus Solutions business. When combined
with Heartland’s existing portfolio of payments, loan servicing and
other campus solutions, the acquisition makes Heartland the largest
provider of integrated commerce solutions to the higher-education market.
“TouchNet will enable us to offer the higher education market an
end-to-end integrated commerce and payments solution that is unmatched
in the industry. We look forward to closing this transaction in the near
term to begin capitalizing on the growth opportunities certain to arise
as a result of our industry-leading position,” Carr continued.
Daniel Toughey, president of TouchNet Information Systems, said, “This
is great news for our many loyal clients, employees and partners.
Heartland is a highly-respected, people-oriented company with a strong
vision for the future of electronic payments.”
“For 25 years, we have been carefully building a technology success
story and joining forces with the Heartland team will allow us to expand
our growth opportunities, which benefits the community in Kansas City,
where TouchNet’s existing 180 employees will remain,” Toughey continued.
Since 1989, TouchNet has been a pioneer in delivering innovative payment
solutions. Colleges and universities have relied on TouchNet to unify
and secure payment and related business transactions throughout the
campus enterprise. TouchNet enables institutions of higher education to
process and manage the myriad of campus payments – from student tuition
to parking to alumni donations to campus events – on one platform and
through one service provider.
So, while a campus may have many payment points, such as centralized
billing or box office collections at athletic venues, and payment types,
such as electronic payments and checks, TouchNet provides a solution
that school business offices can use to unify the campus commerce and
payment operations, generate detailed reports, and enjoy a simplified
customer service experience. This allows institutions to exercise
greater control over campus transactions, costs, compliance and
constituent satisfaction. The software solution, known as U.Commerce®,
is designed to unify the campus enterprise, expand as the campus changes
and deliver integration and innovation.
The acquisition includes TouchNet’s software, customer base and existing
employees, including the management team. Its operations will continue
to be based in Lenexa, Kansas.
“With the acquisition, Heartland can now offer campus business offices
an end-to-end commerce solution that integrates the payment processing
capabilities of Heartland into the U.Commerce payment system,” said
Michael A. Lawler, president - strategic markets group of Heartland
Payment Systems. “This creates new growth opportunities in a large and
growing market where we have the strongest franchise, and the leading
share. As a result of the acquisition, Heartland Campus Solutions will
have relationships with higher-education institutions from the smallest
to the largest, which we believe provides entrÉe to expand all of our
Campus Solutions products across this broad portfolio. As a result, we
believe our Campus Solutions business can sustain attractive revenue
growth rates and use our scale to expand already attractive margins over
Heartland is paying $375 million to acquire TouchNet and, on a non-GAAP
basis, expects the transaction to be slightly accretive in 2014, and to
add at least $0.30 per share in 2015. In addition, Heartland expects
that this transaction will add over $60 million to 2015 net revenue. The
transaction is expected to close in the third quarter of 2014, subject
to regulatory approvals and customary closing conditions.
Heartland has previously announced that it will be holding a conference
call on August 1, 2014, to discuss second quarter earnings. Heartland
intends to provide additional details and address questions regarding
the TouchNet acquisition during that call.
Todd Advisors served as advisor to Heartland Payment Systems and
Raymond James & Associates acted as financial advisor to TouchNet.
About Heartland Payment Systems
Heartland Payment Systems, Inc. (NYSE: HPY),
the fifth largest payments processor in the United States, delivers
credit/debit/prepaid card processing, mobile
commerce, e-commerce, marketing solutions, security technology, payroll
solutions, and related business solutions and services to more than
275,000 business and educational locations nationwide. A FORTUNE 1000
company, Heartland is the founding supporter of The Merchant Bill of
Rights, a public advocacy initiative that educates merchants about fair
credit and debit card processing practices. Heartland also
established The Sales Professional Bill of Rights to advocate for the
rights of sales professionals everywhere. More detailed information can
be found at HeartlandPaymentSystems.com
or follow the company on Twitter @HeartlandHPY and
Facebook at facebook.com/HeartlandHPY
About TouchNet Information Systems, Inc.
Since 1989, TouchNet has been a pioneer in delivering innovative payment
solutions for Higher Education. Colleges and universities have relied on
TouchNet to unify and secure payment and related business transactions
throughout the campus enterprise. Today, TouchNet offers institutions
the industry's broadest spectrum of commerce management solutions.
TouchNet(R) U.Commerce(R) systems help
colleges and universities save, make and manage money better by
delivering greater control over transactions, costs, compliance,
operational efficiencies, and information access. U.Commerce--it's How
Money Moves on Campus(R). For more information,
This press release contains statements of a forward-looking nature
which represent our management’s beliefs and assumptions concerning
future events. Forward-looking statements involve risks, uncertainties
and assumptions and are based on information currently available to us.
Actual results may differ materially from those expressed in the
forward-looking statements due to many factors, including risks and
additional factors that are described in the Company’s Securities and
Exchange Commission filings, including but not limited to the Company’s
annual report on Form 10-K for the year ended December 31, 2013. Given
these risks and uncertainties, prospective and current investors are
cautioned not to place undue reliance on such forward-looking
statements. We undertake no obligation to update any forward-looking
statements to reflect events or circumstances that may arise after the
date of this release.
Gibbs & Soell
Elizabeth McDonnell, 212-697-2600
Source: Heartland Payment Systems