Tyler Technologies announces $670M bid to acquire New World Systems
Photo / Courtesy of Tyler Technologies
Tyler Technologies in Yarmouth
John S. Marr Jr., president and CEO of Tyler Technologies
Tyler Technologies Inc. (NYSE: TYL), a Plano, Texas-based public sector software developer with 540 employees at three locations in Maine, announced Thursday it has signed a definitive agreement to acquire the privately held New World Systems Corp. for $670 million in cash and stock.
Founded in 1981 by President and CEO Larry D. Leinweber, New World Systems is based in Troy, Mich., and has more than 2,000 public sector customers and more than 470 employees. Tyler Technologies, the largest company in the country solely dedicated to providing software and services to the public sector, reported $493.1 million in revenues for 2014, up 18.4% over 2013. It has nearly 2,900 employees and more than 13,000 government and school clients in all 50 states, Canada, the Caribbean, the United Kingdom and other countries.
“Acquiring New World Systems is a highly strategic and growth-oriented decision, and we plan to invest in their products and find new opportunities both in our combined client bases and in markets where they currently are most competitive,” John S. Marr Jr., Tyler’s president and CEO, said in a company statement announcing the pending purchase.
Under the terms of the agreement, Tyler will acquire all of the equity in New World Systems for $360 million in cash and approximately 2.1 million shares of Tyler’s common stock, representing approximately 5.9% of Tyler’s outstanding common shares post transaction, subject to customary post-closing adjustments. The cash portion of the purchase price will be funded from cash on hand and proceeds from a new revolving credit facility. The transaction is expected to close in the fourth quarter of 2015 and is subject to regulatory approval and customary closing conditions. Leinweber will join Tyler’s board of directors upon the closing of the transaction.
Tyler’s stock jumped more than 11% at one point Thursday to an all-time high, according to Investors Business Daily. It closed the day up 10.1% at $164.39 and at 11 a.m. Friday, it was selling at $165.62, up 0.98%.
There are no plans to materially impact either company’s workforce and New World Systems’ headquarters in Michigan is expected to continue to operate virtually unchanged, according to Tyler’s announcement.
Marr described the acquisition as “complementary” to Tyler’s existing customer base and core competencies, noting that Tyler plans to integrate New World Systems’ courts software platform with its own public safety platform to create a unique “end-to-end enterprise criminal justice solution.”
“Odyssey [Tyler’s platform] is already a clear leader in courts and justice software, and we’re seeing very solid growth from our e-filing solution,” Marr said in Thursday’s announcement. “By adding a market leading public safety offering to Tyler’s portfolio of courts and justice solutions, we can deliver a comprehensive enterprise criminal justice system that does not exist in the market today … We believe that our combined offering will create a unique opportunity for communities at the local, county and statewide levels.”
New World Systems is the largest acquisition to date for Tyler.
This summer, Tyler announced plans to expand its office building in Yarmouth, a $15 million project that would allow it to create more than 500 jobs over the next decade. The company’s preliminary plans called for a roughly 85,000-square-foot, four-story office building on Route 1 that would be connected to its existing building. Its other offices are in Bangor and Falmouth.
Leinweber, New World Systems’ founder, president and CEO, also described the proposed acquisition as an opportunity for both companies to complement their existing software portfolios.
“I certainly see this transaction as an opportunity for New World Systems employees and clients to benefit from the kind of investments and vision that Tyler Technologies brings to bear,” he said in a press release. “Both companies operate and have grown in a very responsible manner, our products are strong, we deliver good financial results and have high client retention.”
Forbes has named Tyler one of “America’s Best Small Companies” eight times, and the company has been included six times on the Barron’s 400 Index, a measure of the most promising companies in America.
This summer, Tyler launched the Maine App Challenge in a partnership with Educate Maine and Project>Login. The new competition for Maine high school students offers $10,000 in scholarships to be awarded to the top finalists: a $6,000 first prize, $3,000 second prize and $1,000 third prize. Deadline for submissions is Oct. 16; winners will be announced at the Maine Digital Festival on Dec. 12.
Correction: An earlier version misidentified the Odyssey platform. It is a Tyler Technologies courts-and-justice software platform.
Read more
Tyler Technologies looks to nearly double jobs with Yarmouth expansion
Most Recent
Most Recent
Comments