Repay Holdings Corp., a payment processing company, announced yesterday that it is purchasing BillingTree, another payment processing company, for $503 million in cash and stock. Repay is looking to leverage BillingTree’s technology and presence in a number of verticals, including the accounts receivable management space, to help fuel the company’s continued growth.
During a conference call with analysts to discuss the company’s first quarter financial results as well as to provide perspective about the transaction, Repay co-founder and chief executive officer John Morris said the acquisition of BillingTree — the largest transaction in the company’s history — provides a number of upsides. “We have evaluated hundreds of attractive acquisition candidates over the years and we believe that BillingTree — has the best combination of technology, distribution, talent and scale to complement our company,” Morris said. “BillingTree is a leading provider of omni-channel integrated payments pushed these in biller direct verticals.”
The acquisition is being financed with $275 million in cash and $228 million in Repay stock. Repay said that the acquisition will expand its position in a number of markets, including the ARM industry. One of the drivers that made the BillingTree such an attractive target for Repay was the presence in industries like healthcare and collections, where there was not a lot of overlap between the two companies. Speaking about BillingTree’s presence in the ARM industry, Tim Murphy, Repay’s chief financial officer, said that “they are really a leader in that space and have great technology. They have great relationships both with merchants and with software providers and again that’s very additive to us and we think that there have a ton of great relationships.”
BillingTree brings Repay more than 1,650 clients and integrations with more than 50 software platforms. The payment volume opportunity in BillingTree’s markets is $700 billion, according to a press release announcing the transaction.
“BillingTree satisfies all of our acquisition investment criteria, including a large addressable market opportunity that is amid a shift away from legacy payment methods and towards the technology-first, industry-specific payment mediums in which BillingTree specializes,” Morris said.
