Source: EFunds Corporation
eFunds Corporation (NYSE:EFD) announced today that its wholly owned subsidiary, Chex Systems, Inc., has signed a definitive agreement to acquire substantially all of the assets of National Check Protection Services, Inc. (NCPS), and its affiliates.
NCPS is one of the nation's largest privately held providers of new account verification, employment screening and due diligence investigation services for the financial services and government industries.
The base purchase price of approximately $20 million, which is subject to working capital adjustments and holdback arrangements, will be paid in cash at closing and is expected to occur in the second quarter of 2005 subject to the satisfaction of customary closing conditions.
The NCPS acquisition will deepen eFunds' market footprint into tier one financial institutions while helping to accelerate the delivery of new risk management services to the Northeast market. The acquisition will also allow the Company to add depth to its ChexSystems(SM) new account offering by contributing enhanced bankruptcy and criminal data to DebitBureau®, the proprietary database behind the risk management and fraud components of the product suite.
"This acquisition is another step in the execution of our long term strategic plan," said Rahul Gupta, SVP and division executive at eFunds. "As eFunds continues to expand its leading market position in the account origination and risk management segment, we are also expanding sales opportunities for our entire suite of account lifecycle solutions. Our banking customers in the Northeast can now come to one trusted provider for a full suite of risk management, fraud prevention, electronic payments and related outsourcing solutions."
According to an FTC Identity Theft Survey, fraud accounted for more than $32 billion in losses at the new account desk in 2004 alone. As the instances of fraud continue to rise, the need for deeper and more accurate data on consumers continues to drive the risk management agenda for financial institutions across the country.
"Both companies are known for deep domain expertise in identity verification, fraud and risk management at the new account desk," said Robert J. Zammito, owner of NCPS. "Combining our respective strengths will give our customers access to a comprehensive and predictive fraud prevention platform that will help them better mitigate fraud at the new account desk, and find potential new streams of revenue by leveraging the data for up-sell and cross-sell opportunities."