Digital River and LML Payment Systems have inked a merger agreement, in accordance with which the former will acquire the latter, with an aim to boost its online payment processing base.
The offer price will be paid in cash, which has been valued at $3.45 per share, or an aggregate purchase price of nearly $102.8m, according to the terms of the deal.
Digital River has been focused on online payment processing for enterprise and mid-sized merchants, and the consolidation of LML Payment Systems will enable Digital River to extend its online payment services to businesses of all sizes.
Upon completion of the integration, the company will be able to handle over $20bn in online transactions for tens of thousands of companies across a broad range of industries, including software, consumer electronics, government, utilities, event registration and mobile payments.
Commenting on the deal, Digital River CEO Joel Ronning said, "Our joint technologies and expert resources will create even more value for our combined client bases – helping them reduce time to market and providing access to new payments technologies and geographies."
As per the clauses of the acquisition, LML Payment Systems shareholders will receive $3.45 per share in cash consideration (Consideration) and all options and warrants will be acquired for cash consideration, which will be equal to the Consideration less the exercise price of such option or warrant.
The transaction is expected to complete during the fourth quarter in 2012 or the first quarter in 2013, after obtaining concerned regulatory approval and satisfying customary closing conditions.
RBC Capital Markets offered financial advice to Digital River, and William Blair & Company served as financial advisor to LML Payment Systems.