Deluxe to Acquire New England Business Service
Deluxe Corporation, St. Paul, Minn., recently announced that it has entered into a definitive agreement to acquire New England Business Service, a Groton, Massachusetts-based provider of products and services to small businesses, for an estimated $587 million.
Under the terms of the agreement, Deluxe will pay $44 in cash for each New England Business Service (NEBS) share and will assume NEBS' outstanding debt of approximately $160 million at the end of June. The acquisition is expected to close within 60 days and be accretive to Deluxe's earnings and cash flow for fiscal year 2005. It is expected to add between $.35 and $.45 in earnings per share and between $115 million and $130 million in earnings before interest, taxes, depreciation and amortization to Deluxe's 2005 financial performance.
"The acquisition of NEBS creates a tremendous opportunity to better serve the small business segment," said Lawrence J. Mosner, chairman and chief executive officer of Deluxe. "The combined companies will serve more than 6 million small business customers and generate revenue of almost $2 billion a year. As importantly, we are confident that the acquisition will deliver value to our shareholders," he said.
Richard T. Riley, president and chief executive officer of NEBS, said, "We are pleased to be joining forces with Deluxe. Our companies focuses on helping small businesses manage, promote and grow their businesses. Combining forces creates a strong national presence for small business products and services, presently unparalleled in this industry segment."
Deluxe expects the combination to save more than $25 million in annual costs, beginning in 2005.