Jack Henry to buy Goldleaf

Jack Henry to buy Goldleaf

US payments processor Jack Henry & Associates has agreed to buy Goldleaf Financial Solution in a cash deal worth around $19.1 million.

Under the deal, Goldleaf will become a wholly-owned subsidiary of Jack Henry with shareholders receiving $0.98 per share in cash, a premium of approximately 40% over the firm's closing stock price on Friday.

In addition, Jack Henry will retire certain of Goldleaf's outstanding debt and accrued interest obligations, anticipated to equal about $42 million at closing.

Georgia-based Goldleaf employs around 500 people and claims over 3500 financial institution customers for its various payments and lending technology offerings.

Kevin Williams, CFO, Jack Henry & Associates, says, "Our acquisition of Goldleaf supports our strategy to acquire companies that provide proven solutions that we can cross sell to our core bank and credit union clients, that generate new cross-sale opportunities among our respective client bases, and that expand the specialized products and services our ProfitStars division sells to virtually any financial services organization regardless of core processing platform or size."

Goldleaf's board of directors has unanimously approved the deal, which is expected to close by the end of the third quarter or early Q4 subject to shareholder approval and customary closing conditions.

Goldleaf today reported that it swung to a Q2 net loss of $1.5 million, compared to a net profit of $0.3 million in the second quarter of 2008. The firm has been hit hard by the economic crisis and has cut 25 jobs, implemented a salary and hiring freeze, and reduced third-party contractors, in a bid to save $3 million a year. The firm has also amended its primary credit facility administered by Bank of America.

You can view Goldleaf's share information here and Jack Henry's here.

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