Fintech Acrisure Buys Global Payments' Payroll Unit for a Whopping $1.1 Billion Dollars
Global payments corporation Global Payments, headquartered in Atlanta, Georgia, announced on Wednesday that it would sell its payroll division, Heartland Payroll Solutions, to financial technology firm Acrisure for $1.1 billion. The move is part of Global Payments' strategy to streamline its business model and focus on commerce solutions for merchants of all sizes.
Recently, Global Payments has been reassessing its business, divorcing itself from smaller units to become a specialized payments processor. Last month, the company agreed to sell its issuer solutions unit, which offers card processing and account services, to FIS for $13.5 billion as part of a three-way deal. In 2020, Global Payments also sold its medical software business AdvancedMD to investment firm Francisco Partners for $1.13 billion.
Cameron Bready, Global Payments' CEO, stated that the transaction would sharpen the company's strategic focus and allow it to invest more in its core markets where it excels. The proceeds from the divestiture of Heartland Payroll Solutions will be used to return capital to shareholders, maintaining a neutral leverage position.
Heartland Payroll Services, established in 1997, catering to more than 50,000 clients, including Marathon Petroleum and Burger King, will be rebranded after the deal's completion, set for the second half of 2025. Global Payments will continue to collaborate with Acrisure to offer human capital management and payroll solutions to its merchant customers.
Acrisure, an expanding fintech company based in Grand Rapids, Michigan, plans to use this significant acquisition to bolster its transformation into a comprehensive fintech platform. Earlier this month, Acrisure raised $2.1 billion in a funding round led by Bain Capital at a $32 billion valuation. Once the deal is finalized, Heartland Payroll Solutions will join Acrisure's portfolio of businesses.
Insights from an enrichment analysis suggest that Global Payments aims to focus exclusively on merchant services and payment technology, aiming to drive growth, efficiency, and shareholder value as a pure-play commerce solutions company. The company is also expected to invest more in areas where it is most differentiated, likely including its merchant services, eCommerce, and enterprise payment solutions platforms. Additionally, Global Payments has established a mutual referral agreement and long-term commercial partnership with Acrisure to continue offering integrated HR and payroll solutions to its merchant customers.
In alignment with Global Payments' strategic focus, the company will invest more in its core markets, particularly merchant services and payment technology, as it transitions into a pure-play commerce solutions company. Post completion of the Heartland Payroll Solutions divestiture to fintech firm Acrisure, Global Payments will continue to offer integrated HR and payroll solutions to its merchant customers through its partnership with Acrisure.
