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Scott Meriwether, COOi3 Verticals enables businesses to thrive in today’s fast-paced market with flexible and customizable POS solutions. The company helps its customers improve their operating efficiencies, enhance revenues, and streamline their payment processing functions. Through its proprietary gateway, i3 Verticals offers its clients a single point of access for a broad suite of payment and software solutions.
From enterprise solutions such as NCR Counterpoint, the complete retail management solution, to industry-leading cloud-based solutions that are robust yet easy to implement, i3 Verticals helps retail businesses of all sizes minimize cost, increase sales, and save time. Due to its long history in the payments space, i3 Verticals can seamlessly provide end-to-end seamless integration. This includes interchange optimization to reduce its customer's costs, integration of the payment with payment gateway provider on the front end, backend settlement, end transaction, and the final reporting, which provides rich data for the customer. Moreover, the company offers various scalable software packages, including inventory management and workforce management solutions.
On the hospitality side, i3 Verticals is the largest reseller of NCR Aloha POS, the restaurant industry's leading POS solution in the world. Additionally, the company also handles customer support and service for its clients.
i3 Verticals has completed 37 acquisitions by far for growth and expansion of its business in terms of products/services and scale of operation. This broad list includes several companies with over 50 years of experience catering to a specific space, be it restaurant, retail, or public sector. Besides, i3 Verticals’ executive team comprise industry veterans, each with over 30 years of experience in the payment space. The company gains a competitive advantage in the marketplace with its high level of customer service and consultative selling approach. i3 Verticals continues to support its clients, right from the sale of whatever system the customer needs, throughout and after the implementation process. In one instance, i3 Verticals successfully developed a solution for payroll deductions directly from the employee’s paychecks regarding their purchase made in-house, be it at the coffee shop, cafeteria, or internal drug store, as per the clients’ requirement. “Our ability to listen and consult along with our deep experience brings out that exceptional overall level of service and commitment to ensure effective implementation of a solution,” states Meriwether.
i3 Verticals is a leading provider of seamless, integrated payment and software solutions to small and mid-sized businesses (SMBs)
Apart from retail, i3 Verticals also caters to the public sector space, including government services, education, healthcare, business-to-business payments market, non-profit, and property management. "Being a large software company with varied solutions, we have deep industry expertise into specific verticals which helps us bring better solutions to our customers," emphasizes Meriwether. Looking ahead, i3 Verticals aims to continue researching the latest technology to serve its customer needs better, whether it requires developing a new piece of software or making new acquisitions. Evidently, i3 Verticals is focused on assisting companies with the much-required ability to help them take their businesses to the next level. "We believe that pre-ordering will be a very large component of all restaurant, retail, and education type environments for the next foreseeable future. Our focus will be on delivering solutions that help our customers enable that effectively and successfully," concludes Meriwether.
i3 Verticals Enters Into Definitive Agreement to Sell Merchant of Record Payments Business
Thursday, June 27, 2024
NASHVILLE, Tenn. - i3 Verticals, Inc. (“i3 Verticals” or the “Company”) (NASDAQ: IIIV), and Payroc WorldAccess, LLC (“Payroc”), a leading omni-channel payments provider, today announced that the companies have entered into a definitive agreement whereby Payroc will acquire i3 Verticals’ merchant of record payments business, including its associated proprietary technology (the “divested business”), in an all-cash transaction for $440 million, subject to certain purchase price adjustments.
Greg Daily, Chairman and CEO of i3 Verticals stated, “i3 began as a payments business, and we built a top-of-the-line merchant of record payment platform bringing a wide variety of solutions to third-party partners and software providers. We do not part with this platform lightly and we believe that it has a bright future. We are proud and appreciative of our team managing this business and are confident we have found them the right home.
“This is a key strategic moment for our Company. After the divestiture, we will be a pure vertical market software business focused entirely on the Public Sector, Education and Healthcare markets. Importantly, we have retained our payment facilitation platform and our ability to attach payments to our vertical software solutions. Upon the completion of this disposition, our balance sheet will be stronger than ever, and we are excited to begin our next chapter.”
“Payroc is excited about this combination,” said James Oberman, Chief Executive Officer of Payroc. “The i3 merchant business is an ideal fit for Payroc, and their values and goals align with ours. Our ongoing commitment to combine a personal relationship with payments technology will enhance growth for i3’s partners and create opportunity for i3’s team members that join Payroc once the transaction closes.”
The transaction is subject to closing conditions as set forth in the definitive agreement, including the expiration or termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976. The closing is expected to occur sometime in i3 Verticals’ fiscal fourth quarter.
Strategic Rationale and Benefits of the Transaction
• Selling the divested business will simplify i3’s business. The remaining business consists of vertical market software solutions that fit the Company's customers’ specific enterprise needs.
o The divested business includes two non-core assets from i3's Software and Services segment related to the Non-profit and Property Management vertical markets, representing approximately $4 million in annual adjusted EBITDA.
o The Company's customers will be narrowed to three strategic verticals: Public Sector, Education and Healthcare.
o i3's ongoing business will be approximately 75% software and related services revenue, and 25% payments and other.
• Proceeds from the transaction, after payment of transaction expenses, will go towards paying down debt.
o After taxes, and in the absence of other acquisitions, the Company expects to be able to pay down all, or nearly all, of its 2023 Senior Secured Credit Facility.
o i3's existing 2023 Senior Secured Credit Facility will remain in place, which includes $450 million of aggregate commitments in the form of a revolving credit facility.
o After reducing the Company's debt balance its applicable borrowing rates under the facility will fall by 1% and remain there until such time that Consolidated Total Net Leverage Ratio reaches 2x.
o The borrowing capacity generated will provide significant capital for M&A.
For additional information regarding the terms of the definitive agreement and the transactions contemplated thereby, see the Company’s Current Report on Form 8-K to be filed in connection with the execution of the definitive agreement.
Company
i3 Verticals
Management
Scott Meriwether, COO
Description
i3 Verticals is a leading provider of seamless, integrated payment and software solutions to small and mid-sized businesses (SMBs). i3 Verticals enables businesses to thrive in today’s fast-paced market with flexible and customizable POS solutions. The company helps its customers improve their operating efficiencies, enhance revenues, and streamline their payment processing functions. Through its proprietary gateway, i3 Verticals offers its clients a single point of access for a broad suite of payment and software solutions. From enterprise solutions such as NCR Counterpoint, the complete retail management solution, to industry-leading cloud-based solutions that are robust yet easy to implement, i3 Verticals helps retail businesses of all sizes minimize cost, increase sales, and save time
