Published February 14, 2017
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Date: February 14, 2017
Categories: Channels, Markets Exchanges, Payments, technology
Keywords: PayPal, TIO Networks
PayPal Holdings, Inc. and TIO Networks Corp., a cloud-based multi-channel bill payment processing and receivables management company, today announced a definitive agreement under which PayPal will acquire TIO for $3.35 CAD ($2.56 USD) per share in cash or an approximate $304 million CAD ($233 million USD) equity value. The purchase price represents a premium of 25.2% to TIO’s 90-trading day volume-weighted average price as of February 13, 2017, and 22.6% to the 20-trading day volume-weighted average price as of January 9, 2017, the trading day immediately preceding the date TIO entered into exclusive negotiations with PayPal.
TIO is a leading multi-channel bill payment processor in North America and processed more than $7 billion USD in consumer bill payments in fiscal 2016. TIO serves 14 million consumer bill pay accounts* and offers convenient solutions for expedited bill payment services to financially underserved consumers. The company has more than 10,000 supported billers and numerous direct relationships with billers, which enable TIO to quickly process telecom, wireless, cable and utility bill payments for TIO’s customers. Using TIO’s approximately 900 operated self-service kiosks, approximately 65,000 retail walk-in locations, and mobile and web solutions, customers can conveniently pay their bills while avoiding the service interruptions and financial penalties associated with missed payment deadlines.
Dan Schulman, President and CEO of PayPal, said, “By acquiring TIO and integrating bill payment into our global payments platform, PayPal adds another key service in our efforts to become a part of a consumer’s everyday financial life. Worldwide, more than 2 billion** people do not have affordable access to basic financial services, making it difficult and expensive for consumers to carry out basic financial tasks, including bill payment. TIO’s digital platform, and physical network of agent locations make paying bills simpler, faster, and more affordable. We are excited by the opportunity to extend this valuable service to our existing customers and welcome new billers and customers to PayPal.”
Hamed Shahbazi, Chairman and CEO of TIO, remarked, “We founded TIO to make speed and access part of the bill payment experience for the underserved, and we believe that we have created affordable products to serve the needs of all customers. Our mission fits perfectly with PayPal’s vision to democratize money. As part of the PayPal team, we believe we will accelerate our growth through expanded distribution and continue increasing access to more billers and services.”
Expected Strategic Benefits of the TIO Acquisition
- Aligned with PayPal’s Vision: TIO supports PayPal’s vision of democratizing money by giving consumers more convenient and affordable ways to pay their bills.
- Expands Market Opportunity: TIO accelerates PayPal’s entry into bill payments with 14 million consumer bill pay accounts*, approximately 60 million transactions processed in TIO’s fiscal 2016 and a processing network that includes more than 10,000 billers.
- Extends Consumer Value Proposition: PayPal’s intention is to offer TIO’s valuable service to PayPal’s customers within its online and mobile experiences.
Upon closing of the acquisition, TIO will operate as a service within PayPal
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