REPAY Announces the Acquisition of TriSource SolutionsAugust 14, 2019 04:05 PM Eastern Daylight Time
ATLANTA--(BUSINESS WIRE)--Repay Holdings Corporation (NASDAQ: RPAY) (“REPAY”) (“the Company”), a leading provider of vertically-integrated payment solutions, today announced the acquisition of TriSource Solutions (“TriSource”), for up to $65 million, which includes a performance based earn out. The acquisition was financed with a combination of cash on hand and proceeds from borrowings under REPAY’s existing credit facility. TriSource, founded in 2007, provides back-end transaction processing services to independent sales organizations (“ISO’s”) and operates as a direct ISO on behalf of its owned portfolios and external sales agents. TriSource is headquartered in Bettendorf, IA with an additional office in East Moline, IL. Since 2012, TriSource has been REPAY’s primary third-party processor for back-end settlement solutions and a valuable partner that has supported the Company’s growth.
“TriSource will enable us to build more intelligent payment solutions and bring these solutions to our customers faster. Additionally, we see the potential for strong organic growth in TriSource’s back-end settlement business, and our long partnership with TriSource has illustrated its inherent value proposition. We are looking forward to leveraging TriSource’s capabilities to drive continued growth. Further, the acquisition enhances our M&A strategy, as having our own back-end transaction processing capabilities will allow us to reduce future targets’ transaction processing costs and to expedite other synergy realization efforts. The TriSource acquisition will be immediately and meaningfully accretive to earnings,” said John Morris, CEO of REPAY.
“We are excited to join the REPAY team,” said Deborah Brown, COO of TriSource Solutions. “We have partnered with REPAY for many years and believe they will help us to accelerate our processing business growth. We look forward to working alongside the REPAY team to drive long term growth at the combined company.”
“TriSource owners Henry Harp and Bill Brockway, along with the company’s executive management team, have built a toptier organization. I’ve had the pleasure of working alongside the TriSource team over the past seven years and believe adding them to the REPAY family will be beneficial to all parties. I would like to take this opportunity to welcome them to our organization,” said Shaler Alias, President of REPAY.
- REPAY acquired TriSource for up to $65 million
- $60 million was paid at closing
- Up to $5 million is structured as a performance based earn out
- The acquisition was financed with a combination of cash on hand and borrowings under REPAY’s existing credit facility
- Annualized Adjusted EBITDA is expected to be approximately $7.0 million
- Combined net leverage expected to be approximately 3.5x on a post-transaction basis 
This communication contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements include, but are not limited to, statements about future financial and operating results, our plans, objectives, expectations and intentions with respect to future operations, products and services; and other statements identified by words such as “will likely result,” “are expected to,” “will continue,” “is anticipated,” “estimated,” “believe,” “intend,” “plan,” “projection,” “outlook” or words of similar meaning. These forward-looking statements include, but are not limited to, statements regarding REPAY’s industry and market sizes, future opportunities for REPAY and REPAY’s estimated future results, including the full year 2019 outlook. Such forward-looking statements are based upon the current beliefs and expectations of our management and are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are difficult to predict and generally beyond our control. Actual results and the timing of events may differ materially from the results anticipated in these forward-looking statements.
In addition to factors previously disclosed in prior reports filed with the SEC and those identified elsewhere in this communication, the following factors, among others, could cause actual results and the timing of events to differ materially from the anticipated results or other expectations expressed in the forward-looking statements: a delay or failure to realize the expected benefits from the business combination; a delay or failure to integrate and realize the benefits of the TriSource acquisition and any difficulties associated with operating in the back-end processing markets in which REPAY does not have any experience; changes in the payment processing market in which REPAY competes, including with respect to its competitive landscape, technology evolution or regulatory changes; changes in the vertical markets that REPAY targets; risks relating to REPAY’s relationships within the payment ecosystem; risk that REPAY may not be able to execute its growth strategies, including identifying and executing acquisitions; risks relating to data security; changes in accounting policies applicable to REPAY; and the risk that REPAY may not be able to develop and maintain effective internal controls.
Actual results, performance or achievements may differ materially, and potentially adversely, from any projections and forward-looking statements and the assumptions on which those forward-looking statements are based. There can be no assurance that the data contained herein is reflective of future performance to any degree. You are cautioned not to place undue reliance on forward-looking statements as a predictor of future performance as projected financial information and other information are based on estimates and assumptions that are inherently subject to various significant risks, uncertainties and other factors, many of which are beyond our control. All information set forth herein speaks only as of the date hereof in the case of information about REPAY or the date of such information in the case of information from persons other than REPAY, and we disclaim any intention or obligation to update any forward looking statements as a result of developments occurring after the date of this communication. Forecasts and estimates regarding REPAY’s industry and end markets are based on sources we believe to be reliable, however there can be no assurance these forecasts and estimates will prove accurate in whole or in part. Annualized, pro forma, projected and estimated numbers are used for illustrative purpose only, are not forecasts and may not reflect actual results.
REPAY provides integrated payment processing solutions to verticals that have specific transaction processing needs. REPAY’s proprietary, integrated payment technology platform reduces the complexity of electronic payments for lenders, while enhancing the overall experience for consumers.
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ABOUT USOperating a proprietary in-house clearing and settlement system, TriSource provides clients an alternative to the cumbersome legacy systems of the traditional mega processors as well as the “super ISOs” who both are using your scale to support their direct business. TriSource offers economical and highly reliable merchant processing services, access to front-end authorization and terminal help desk services through a partnership with TSYS®, along with BIN access through various sponsor banks.
HISTORYTriSource was formed under the name CentralBANCARD in 2003 as a traditional third party ISO based out of Davenport, Iowa. Under an exclusive agreement, CentralBANCARD utilized the clearing and settlement processor Nobel Electronic Transfer. In 2007 CentralBANCARD purchased Nobel and rolled the two entities into TriSource Solutions LLC. Our primary focus since that time is to provide the highest level of service available in the marketplace to our third party processing clients. Built from the ground up over two decades ago to provide error free transaction processing based upon highly flexible and scalable technology, the TriSource Acquiring System continues to provide innovation and quality to our customers today. TriSource offers data processing experience and capacity coupled with system redundancy for complete dependability and error free processing.
CLEARING AND SETTLEMENT CONNECTIVITY
WHY TRISOURCE?Tired of getting ignored by your current big, corporate, bottom-line-driven processor, whose primary focus is their direct merchant portfolio? We are a private company with industry veteran entrepreneurs looking to help ISO entrepreneurs and smaller regional Banks grow their business in a win/win situation for both of us.
- NO MISSED CLEARING OR FUNDINGS
- NO INTERCHANGE QUALIFICATION ERRORS
- NO MASS DOWNGRADES
- NO SYSTEM INTERRUPTIONS OR DOWNTIME
- EXCEPTIONAL CLIENT SATISFACTION
- NO EXCUSES - JUST EXCEPTIONAL RESULTS
TriSource Solutions is one of REPAY’s critical service providers. We have used several clearing and settlement platforms since the inception of REPAY and not one of them compares to TriSource Solutions. What makes TriSource so great? Their amazing team. For the most part, all clearing and settlements platforms do the same jobs—they clear and settle bank card transactions and bill customers. The difference between TriSource and their competitors is the management team and the support staff. They are available every day to help you understand all aspect of the merchant services business. They answer their phone, they return your phone calls, and they even provide you with their cell phones numbers. The larger platforms do not come close to providing this level of customer service. Had it not been for TriSource Solutions, our company would not be where we are today! We look forward to many more years with TriSource. Thanks,
REPAY Realtime Electronic Payments Shaler Alias, CPP, President
TriSource is an excellent industry partner.
For ABC Financial Services, relationships are one of the most important aspects of our business culture! TriSource understands this and has proven this to ABC over many years of excellent service to our customers. TriSource is very responsive, dependable, and provides flexibility for us to ensure we can make Raving Fans out of customers! We are very proud to have been partners with TriSource since 2007 and to have received the outstanding experience through their customer service! We would recommend all businesses to consider using TriSource!
ABC Financial Paul Schaller, CEO
As experienced sales agents in the credit card processing industry, we decided it was time for us to maximize our profits, eliminate all of the middlemen, and obtain our own ISO license! TriSource has been the perfect solution to our needs. Not only did they sponsor us for our ISO license, but provided us with all of the support and systems that we could not provide on our own. When you're too big to be an agent, and too small to be a large ISO, TriSource is the perfect partner to help you provide a professional image and manage the facets that you are not ready for!
Meritum, LLC. David Barwick, President