Payment processor company Heartland Payment Systems (HPY) recently announced the acquisition of Ovation Payroll - a U.S-based payroll outsourcing company with a customer base of nearly 10,000 in 48 states - for an undisclosed amount.
With this acquisition, Heartland will gain operational synergies and look to fulfil clients’ requirement of superior services and product offerings. The company expects the acquisition of Ovation Payroll to be beneficial in the long term, enabling it to reach new heights with respect to ongoing services and portfolio expansions.
Post-acquisition, Heartland's payroll business would be augmented with additional know-how from veteran players in the payroll industry, coupled with a highly developed Affinity Partner network, which could eventually lead to strong sales. The consolidated business will serve more than 22,000 clients with an expanded management team and highly skilled sales force, thereby facilitating growth. Ovation Payroll will further provide Heartland with a distribution network to gain access in new markets, which in turn would pave its way to become the industry's only all-inclusive payroll provider. This would also help merchants to save money and attain all services under a single roof with an enhanced payroll service platform.
The transaction is a win-win situation for both the companies. By integrating its services, technology and sales teams with Heartland, Ovation Payroll will be able to contend with the most competitive payroll solutions in the market.
Headquartered in Princeton, New Jersey Heartland is the sixth largest bankcard payment processor that offers credit, debit and prepaid card services across the US and Canada. The company provides loyalty marketing, technical business solutions and services to more than 250,000 organizations.
Heartland currently has a Zacks #1 Rank (short-term Strong Buy) and a long-term Outperform recommendation. One of its competitors, Global Payments Inc (GPN) carries a Zacks #3 Rank (short-term Hold).
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