WEX gets FTC clearance for Electronic Funds Source acquisition
WEX Inc. (NYSE:WEX), a South Portland-based corporate payments company, announced Thursday that the U.S. Federal Trade Commission has unconditionally cleared its previously announced acquisition of Electronic Funds Source LLC, a fleet card provider, for $1.1 billion in cash plus 4 million shares of common stock.
The transaction, announced last October, is expected to close at the beginning of the third quarter, subject to customary closing conditions, the company said in a release announcing the FTC’s approval. WEX intends to finance the $1.1 billion cash portion of the deal consideration through a combination of a new revolving credit facility.
Based on the current expectations for closing and financing rates, WEX reported that it expects the transaction will add to its adjusted net income over the next 12 months. However, given the timing of the close, WEX also reported that it does not expect the transaction will have a material impact on previously issued guidance for the remainder of 2016.
Additional details on deal synergies expected to occur after the transaction closes would be provided when it announces its second quarter 2016 results, the company stated in its release.
At the time the acquisition was first announced last fall, WEX characterized Ogden, Utah-based Electronic Funds Source's strong track record and broad customer base in mid- and large-sized over-the-road fleet segments as an “ideal complement” to its own fleet card offerings. Because the two companies have focused on different parts of the corporate payments sector, the deal would allow customers to benefit from a combined set of capabilities, the company said at that time, noting that for WEX customers, the acquisition would mean more of a variety of corporate card options, including a single, multi-purpose card.
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