Broadridge Acquires DST’s North American Customer Communications Business

Broadridge Acquires DST’s North American Customer Communications Business
16.06.2016 01:45 pm

Broadridge Acquires DST’s North American Customer Communications Business

M&A Deals

Broadridge Financial Solutions, Inc.  has entered into a definitive agreement to acquire the North American Customer Communications (“NACC”) business of DST Systems, Inc. (NYSE:DST) for $410 million in cash, subject to customary working capital and other closing adjustments. As the largest transactional printer in North America, NACC is a leading provider of customer communication services including print and digital communication solutions, content management, postal optimization, and fulfillment.

The NACC business has over 2,300 associates and four production facilities located in El Dorado Hills, CA, South Windsor, CT, Kansas City, MO, and Markham, Ontario, Canada. The NACC business has pioneered innovations to drive operational excellence including best of breed technology to onboard clients and deliver accurate and timely communications to their customers. Its clients include many Fortune 500 companies, primarily in financial services and also in healthcare, telecommunications and utilities. In their fiscal year 2015, the NACC business generated $1.1 billion of total revenue, and $445 million of fee revenue. Senior management, led by Mike Abbaei, Head of DST’s Customer Communications business, will be joining Broadridge as part of this transaction.

Upon closing, the NACC business will become part of Broadridge’s Investor Communication Solutions business, creating North America’s premier customer communications technology platform. This will enhance Broadridge’s position as a leading provider of multi-channel communications with exceptional scale in print communications and leading offerings for digital communications. The combination will allow clients to engage customers with new, unique capabilities and further enhance Broadridge’s ability to meet its clients’ current and future customer communications needs.  Broadridge expects to achieve approximately $20 million in annualized cost synergies within 18-30 months of closing. Broadridge anticipates the NACC business will be immediately accretive to its GAAP and adjusted earnings, inclusive of incremental interest expense.  Broadridge expects the acquisition to be $0.01 to $0.03 per share accretive on a GAAP basis and $0.11 to $0.14 per share accretive on a non-GAAP adjusted basis in the first year. Broadridge also expects the acquisition to be $0.09 to $0.13 per share accretive on a GAAP basis and $0.16 to $0.21 per share accretive on a non-GAAP adjusted basis in the second year.

“This is the next step forward in Broadridge’s journey, and it will create value for clients and shareholders in the near, medium and long term,” commented Richard J. Daly, President and Chief Executive Officer, Broadridge. “Our goal has always been to be the premier, trusted provider to our clients, offering solutions that allow them to effectively, efficiently and securely communicate with their customers.  The addition of NACC, an industry leader, is a natural extension of our communications business and will provide immediate benefits for our clients through enhanced production capabilities and expedited delivery times. This acquisition is consistent with our strategy and adds to our bottom line immediately.  It also positions us to be a communications leader across a number of market verticals and a provider of a unique suite of multi-channel communications solutions, empowering Broadridge to accelerate the industry’s conversion to digital communications and meet the diverse preferences of our clients’ customers.”

Mike Abbaei, Head of DST’s Customer Communications, stated, “The management team and I are delighted to join Broadridge, a trusted industry leader in providing critical customer communications.  The combined entity will create the industry’s largest distributor of critical client content across North America. We share the same focus on client service and are excited by the differentiated solutions across all channels that this acquisition enables. The integration of these capabilities will align our clients to benefit from the industry’s best technologies, quality and footprint. It also strategically positions our clients to benefit from the evolution of consumer preferences.”

Douglas R. DeSchutter, President, Digital Communications, Broadridge, said, “This acquisition establishes a best-in-class, integrated technology platform positioned to successfully leverage a rapidly growing digital opportunity. The consumer reach of the combined business exceeds 75% of North America’s mailboxes and will allow Broadridge to greatly expand its role in digitizing critical investor and consumer content and to make every communication more valuable.”

The transaction is subject to customary closing conditions and is expected to close in July 2016.

- See more at: http://otp.investis.com/clients/us/broadridge/usn/usnews-story.aspx?cid=928&newsid=36157#sthash.qFghXnAz.dpuf

Related News

Venafi to Acquire Jetstack to Accelerate and Secure Digital Transformation

Venafi®, the inventor and leading provider of machine identity... Read more »

IHS Markit Acquires Catena Technologies

 IHS Markit (NYSE: INFO), a world leader in critical information, analytics and solutions, today announced the acquisition of Catena Technologies (Catena), a global regulatory... Read more »

Santander strengthens its international trade operations for SMEs with the completion of the investment in Ebury

Banco Santander announced today the completion of its purchase of a c.50.1% stake in Ebury, one of the best international payment, FX and international cash management... Read more »

Tenth Revolution Group Acquires Top AWS Solutions Provider, Rebura

Tenth Revolution Group, a global leader in cloud talent solutions, today announced the acquisition of Rebura, one of the UK’s fastest-growing Amazon Web Services (AWS)... Read more »

Auriga acquires the award-winning ATM cybersecurity solution Lookwise Device Manager from leading managed security services provider S21sec

Auriga, a leading supplier of technological solutions for the omnichannel banking and payments industries, announces the acquisition of Lookwise Device Manager (LDM), a modular... Read more »

TietoEVRY integration progressing as planned – employee consultations initiated to drive merger-related efficiencies

TietoEVRY is taking the next step in the integration to ensure its position as the leading digital services and software company in the Nordics. A unified organization... Read more »

Magazine
ALL
Free Newsletter Sign-up
+44 (0) 208 819 32 53 +44 (0) 173 261 71 47
Download Our Mobile App
Financial It Youtube channel