Business Wire, Sept 30, 2009
Acquisition Likely to be Accretive to Ebix EPS
ATLANTA — Ebix, Inc. (NASDAQ: EBIX), a leading international supplier of On-Demand
software and E-commerce services to the insurance industry, announced
today that it has acquired Ohio-based Peak Performance Solutions, Inc.
effective the 1st of October 2009. The signing of the binding
agreement and the closing of the transaction was completed today. The
acquisition is expected to be accretive to Ebix Earnings per Share
(EPS) in the near and long-term future.
Peak Performance Solutions, Inc. (PEAK), offers comprehensive,
end-to-end insurance software and technology solutions to insurance
companies, self-insured entities, and risk management organizations in
the areas of workers compensation claims processing, risk management
claims administration, managed care tracking and backend policy
administration.
All PEAK exchange products are available in an On-Demand basis while the
backend policy systems are available in an ASP and self-hosted basis.
75% of PEAK revenues are recurring in nature, in the form of
subscription fees, application service provider fees, technical service
and support fees.
Peak currently services 450 customers who are positioned within the
property and casualty insurance industry, the risk management industry,
or are self-insured organizations that benefit from the types of
insurance management tools provided by Peak. No single customer accounts
for more than 10% of revenues.
The deal will involve an upfront cash payment of $8 million to Peak
shareholders plus a potential earn-out cash payment of up to $1.5
million, paid after a period of 1 year from the date of acquisition
provided that specific revenue targets are achieved. Ebix funded the
acquisition with internal sources using its own cash reserves. No shares
of Ebix’s capital stock were issued as a part of the deal, thus
resulting in no share dilution to Ebix’s existing shareholders. No
financial advisors were involved in the transaction from the Ebix side.
Robin Raina, Chairman, President and CEO of Ebix, said, “Peak has been a
strong player in the workers compensation claims, risk management,
managed care and the claims processing industry. The addition of these
services to EbixExchange
will further strengthen our position in the fast-growing risk management
and claims processing sector of the insurance industry.
Raina added, On the economic front, we are excited about this
acquisition on many accounts. Firstly, it brings a revenue base to the
company that is 75% recurring. This base covers a combined customer base
of 450 customers comprising 40 insurance companies, 5 state
governments, and risk departments of a few hundred companies; and with
little dependence on any one large client, Peak provides us with the
kind of diverse customer base that we like
atlanta workers compensation