Intuit to Acquire Electronic Clearing House
Intuit and Electronic Clearing House have announced they have "signed a definitive agreement for Intuit to acquire ECHO. Under the terms of the agreement, Intuit will pay $17 per share in cash in exchange for each share of ECHO common stock, including shares issuable upon exercise of options. The total purchase price is approximately $131 million on a fully diluted basis."
ECHO, based in Camarillo, Calif., is a leading provider of electronic payment processing solutions, including check, debit card and credit card processing, as well as check verification, collection, and guarantee services and automated clearing house capabilities, or ACH.
Intuit had previously signed a definitive agreement to acquire ECHO in December 2006, but the parties mutually terminated the arrangement in March. Since that time, ECHO has refocused its business and addressed governmental concerns while continuing to generate revenue growth. With ECHO’s business changes and continued solid performance, the companies now agree that conditions are more favorable for a successful acquisition.
“Since our last discussions with ECHO, we’ve continued to survey the market and believe today, as we did then, that ECHO is a great strategic fit for Intuit,” said Brad Smith, senior vice president and general manager of Intuit’s small business group. “We expect ECHO’s technology and operational assets will help us accelerate Intuit’s growth and strengthen our expanding small business ecosystem that includes the fast-growing payments space.”
With ECHO’s ACH capabilities, Intuit will be able to round out its payment offering with check services. The company will be able to offer solutions to merchants that address the most commonly used payment methods, including credit card, debit card, ACH, gift card, check verification, collection, guarantee and conversion. The combined offerings will be designed to save merchants time and money and will continue to differentiate Intuit’s solutions from other electronic payment providers.
In addition, the acquisition of ECHO will expand Intuit’s sales and distribution channels and provide relationships with thousands of customers, including larger enterprise customers.
“Today, ECHO has strengthened its focus on delivering ACH and card technology that includes comprehensive payment processing services, a technology platform, and established relationships with customers and partners,” said Chuck Harris, ECHO’s chief executive officer. “ECHO’s leading technology solution and team of payment industry professionals, coupled with Intuit’s focus on easy to use solutions, will help the combined company to deliver new and innovative products to customers."
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