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ECHO
Press Releases 2007
FOR IMMEDIATE RELEASE
Intuit to Acquire Electronic Clearing House Inc.
Strategic Fit for Intuit's
Payments Business
Mountain View, Calif & Camarillo, Calif., Dec
19,
2007 -
Intuit Inc. (Nasdaq: INTU) and Electronic Clearing House Inc.,
(ECHO), (Nasdaq: ECHO) 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.”
The transaction is subject to regulatory review,
ECHO shareholder approval and other customary closing
conditions. It is expected to close in the first quarter of calendar
year 2008, at which time ECHO will become a wholly owned
subsidiary of Intuit, and ECHO’s
stock will cease trading. Intuit expects the acquisition to be
slightly dilutive in fiscal 2008 and 2009.
Officers and directors of ECHO entered into
voting agreements with Intuit, pursuant to which the officers and
directors agreed, among other things, to vote their shares of
ECHO common stock in favor of the transaction.
The proposed acquisition was approved by the board
of directors of each company. Wedbush Morgan Securities advised
ECHO and rendered a fairness opinion in connection with the
acquisition.
About Intuit Inc.
Intuit Inc. is a leading provider of business and
financial management solutions for small and mid-sized businesses;
financial institutions, including banks and credit unions; consumers
and accounting professionals. Its flagship products and services,
including QuickBooks®, Quicken®
and TurboTax® software, simplify small
business management and payroll processing, personal finance, and
tax preparation and filing. ProSeries®
and Lacerte® are Intuit's leading tax
preparation software suites for professional accountants. The
company’s financial institutions
division, anchored by Digital Insight, provides on-demand banking
services to help banks and credit unions serve businesses and
consumers with innovative solutions.
Founded in 1983, Intuit had annual revenue of
$2.67 billion in its fiscal year 2007. The company has approximately
8,000 employees with major offices in the United States, Canada, the
United Kingdom and other locations. More information can be found at
www.intuit.com.
About Electronic Clearing House, Inc.
A merchant account with ECHO (www.echo-inc.com)
provides a fully integrated payment processing suite, including
credit card processing, electronic check conversion (ECC), eChecks
(ACH), check guarantee, check verification, check collection, and
debit cards. Merchants nationwide benefit from ECHO’s
wide ranging payment services available through the Company’s
dedicated sales force or through channels that include technology
partnerships, banks, collection agencies and other acquiring
entities.
Forward-looking
Statements
This news release includes forward-looking
statements which are subject to safe harbors created under the
U.S. federal securities laws. All statements included in this
press release that address activities, events or developments
that Intuit or ECHO expects, believes or anticipates will
or may occur in the future are forward-looking statements,
including, particularly, statements related to the expected
dilutive effect of the transaction for Intuit, the anticipated
reach, capabilities and opportunities for the combined company,
the potential benefits of the proposed transaction to Intuit,
future products and services, expected benefits to merchants and
other customers, market opportunities, expected customer base,
and the anticipated closing of the transaction. These statements
are based on certain assumptions and reflect our current
expectations. Statements including words such as
“anticipate,”
“propose,”
“estimate,”
“believe”
or “expect”
and statements in the future tense are forward-looking
statements. These forward-looking statements involve known and
unknown risks, uncertainties and other important factors that
could cause the actual results, performance or achievements to
differ materially from any future results, performance, or
achievements discussed or implied by such forward-looking
statements. Some of the factors that could cause results to
differ materially from the expectations expressed in these
forward-looking statements include the following: the risk that
the proposed transaction may not be completed in a timely
manner, if at all; disruption from the transaction making it
more difficult to maintain relationships with customers,
employees or suppliers; risks related to the successful offering
of the combined company’s products
and services; the risk that the anticipated benefits of the
merger may not be realized; and other risks that may impact
Intuit’s and ECHO’s
businesses, some of which are discussed in the companies’
reports filed with the Securities and Exchange Commission (the
“SEC”)
under the caption “Risks That Could
Affect Future Results” or
“Risk Factors”
and elsewhere, including, without limitation, Intuit’s
Form 10-K for the fiscal year ended July 31, 2007 and ECHO’s
10-K for the year ended September 30, 2007. Copies of Intuit’s
and ECHO’s filings with the
SEC can be obtained on their Web sites, or at the SEC’s
Web site at www.sec.gov. You
can also obtain Intuit’s report
through its Web site at
http://www.intuit.com/about_intuit/investors
and ECHO’s reports through its
Web site at
http://www.ECHO-inc.com/investors.html. Any forward-looking
statement is qualified by reference to these risks,
uncertainties and factors.
If any of these risks or uncertainties
materializes, the acquisition may not be consummated, the
potential benefits of the acquisition may not be realized, the
operating results of Intuit and ECHO could suffer, and
actual results could differ materially from the expectations
described in these forward-looking statements. Forward-looking
statements speak only as of the date of the document in which
they are made. These risks, uncertainties and factors are not
exclusive, and Intuit and ECHO undertake no obligation to
publicly update or revise any forward-looking statements to
reflect events or circumstances that may arise after the date of
this release.
Additional
Information About the Proposed Transaction and Where You Can
Find It
This press release may be deemed to be a
solicitation in respect of the proposed acquisition of ECHO
by Intuit. In connection with the proposed transaction, ECHO
intends to file a proxy statement and other relevant materials
with the Securities and Exchange Commission. BEFORE MAKING ANY
VOTING DECISION WITH RESPECT TO THE PROPOSED TRANSACTION,
STOCKHOLDERS OF ECHO ARE URGED TO READ THE PROXY STATEMENT, WHEN
IT BECOMES AVAILABLE, AND THE OTHER RELEVANT MATERIALS FILED BY
ECHO WITH THE SEC BECAUSE THEY WILL CONTAIN IMPORTANT
INFORMATION ABOUT THE PROPOSED TRANSACTION. The proxy statement
and other relevant materials, when available, and any other
documents filed by ECHO with the SEC, may be obtained
free of charge at the SEC’s Web site
at www.sec.gov. In addition,
stockholders of ECHO may obtain free copies of the
documents filed with the SEC by contacting ECHO Investor
Relations at 800-262-3246 ext. 8533, or by email to
corp@ECHO-inc.com. You
may also read and copy any reports, statements and other
information filed by ECHO with the SEC at the SEC public
reference room at 100 F Street, N.E. Room 1580, Washington, D.C.
20549. Please call the SEC at 1-800-SEC-0330 or visit the SEC’s
Web site for further information on its public reference room.
ECHO and its executive officers and
directors may be deemed to be participants in the solicitation
of proxies from ECHO stockholders in favor of the
proposed transaction. Certain executive officers and directors
of ECHO have interests in the transaction that may differ
from the interests of stockholders generally. These interests
will be described in the proxy statement when it becomes
available.
In addition, Intuit and its executive officers
and directors may be deemed to be participants in the
solicitation of proxies from ECHO’s
stockholders in favor of the approval of the proposed
transaction. Information concerning Intuit's directors and
executive officers is set forth in Intuit's proxy statement for
its 2007 annual meeting of stockholders, which was filed with
the SEC on Nov. 1, 2007, and annual report on Form 10-K filed
with the SEC on Sept. 14, 2007. These documents are available
free of charge at the SEC’s Web site
at www.sec.gov or by going to
Intuit’s Investor Relations Web site
at
http://www.intuit.com/about_intuit/investors.
Contact:
Intuit Inc.
Bob Lawson, 650-944-6165 (Investors)
robert_lawson@intuit.com
Diane Carlini, 650-944-6251 (Media)
diane_carlini@intuit.com
or
ECHO
Donna Rehman, 800-262-3246 ext. 8533 (Investors)
corp@ECHO-inc.com
www.echo-inc.com
or
Financial Profiles for ECHO
Moira Conlon, 310-277-4711 (Investors)
mconlon@finprofiles.com
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