ACI Worldwide has acquired Western Union's US bill pay business Speedpay for $750 million in an all-cash transaction.
With more than 15 billion transactions in 2018, the US bill pay market continues to grow at steady mid-single digit rates, driven by increased consumer adoption of digital and mobile payments, the move to real-time payments and digital subscription billing.
ACI says it intends to merge its own UP Bill Pay platform with Speedpay creating a unified solution capable of supporting billions of transactions.
The combined business will serve more than 4000 customers across the US, bringing expanded reach in existing and complementary segments such as consumer finance, insurance, healthcare, higher education, utilities, government and mortgage.
Speedpay generated more than $350 million in revenue and $90 million in adjusted Ebidta in 2018.
Hikmet Ersek, president and CEO of Western Union, says: “Divesting the Speedpay business allows us to concentrate our resources on our cross-border money movement strategies and monetise a non-core asset for our shareholders. Our strategy remains focused on expanding our digital services, leveraging our platform to unlock new cross-border, cross-currency payments opportunities, and generating additional operating efficiencies.”
The transaction - the largest in ACI Worlwide's history - is expected to close by the end of the second quarter of 2019.