Trintech's $26 million (€31 million) acquisition of Dublin-based Exceptis Technologies will create a couple of new Irish paper millionaires. The deal, the second by the electronic payments firm in as many days, will see Exceptis's two founding members and major shareholders - Mr Bill O'Connor and Mr Brian Caulfield - join Dublin's growing pool of New Economy millionaires.
Other beneficiaries from the buyout include: Enterprise Ireland, which holds an 8 per cent shareholding; venture capital group Delta Partners with 25 per cent; staff 15 per cent and management, which holds the balance. The all-stock deal will be financed through the issue of $16 million worth of Trintech shares. A further $10 million share payment is linked to a two-year performance target.
Exceptis, which was formerly known as Peregrine Systems, is a provider of automated dispute resolution and fraud management technology. The company has a customer base of more than 50 financial institutions and carries an endorsement from Visa.
The acquisition is the fourth in just over three months by Trintech at a total cost of $112 million. The 60 staff at Exceptis will bring Trintech's total workforce to about 650.
The financial record of Exceptis, which was founded in 1992, will not be revealed until a meeting with analysts next week. Last month the company purchased rule-engine technology from a Californian company, Blaze Software, to use with its own suite of products. Mr Cyril McGuire, executive chairman of Trintech, said the acquisition was consistent with Trintech's growth strategy and would broaden its product suite.
Trintech was clearly positioned for significant growth and had a "war chest" of almost $140 million in cash for further investment, he added.
Mr McGuire said the decision to issue stock rather than pay cash for the acquisitions was to enable Trintech to drive forward its business plans. The intention was not to dilute shareholders stock but to improve shareholder value, he added.
"Most companies in the technology area are undercapitalised and are being punished for that when they have to come back to the markets to raise cash," he said.
On Monday, Trintech acquired its US-based competitor, Globeset. Since August this year Trintech has also acquired the Latin American technology company, Sursoft, and the British firm, Checkline.
