PAYA - Paya Holdings stock climbs after Nuvei agrees to acquire Paya for $1.3B cash

Paya Holdings ( NASDAQ: PAYA ) stock surged 25% in Monday premarket trading after Nuvei ( NASDAQ: NVEI ) agreed to acquire the payment tech  for $9.75 per share in cash, or a total consideration of ~$1.3B.

The acquisition will accelerate Nuvei's ( NVEI ) integrated payment strategy, and diversify its business into key high-growth non-cyclical verticals with large addressable end markets, NVEI Chair and CEO Philip Fayer said in a statement. Nuvei shares dipped 6.6% in premarket.

"The proposed acquisition of Paya ( PAYA ) is a powerful next step in the evolution of Nuvei ( NVEI ), creating a preeminent payment technology provider with strong positions in global eCommerce, Integrated Payments and business-to-business," he said.

The purchase price represents a 25% premium to Paya's ( PAYA ) Jan. 6 closing price and a 30% premium to its 90-day volume-weighted average share price.

Nuvei ( NVEI ) expects to finance the acquisition with a combination of cash on hand, an existing credit facility, and a new committed $600M first lien secured credit facility.

The deal is expected to result in up to $21M of estimated run-rate cost synergies within 24 months and to add to adjusted EPS in 2023.

An investment fund affiliated with GTCR, which holds ~34% of Paya's ( PAYA ) shares outstanding agreed to tender its shares to Nuvei ( NVEI ).

NVEI's net leverage ratio — consolidated net debt outstanding to consolidated adjusted EBITDA — is expected to be less than 3x upon closing.

The deal brings to Nuvei ( NVEI ) businesses in the B2B goods and services, healthcare, non-profit and education, and government and utilities verticals.

Last week, SA contributor Stephen Frampton conducted detailed analysis of Nuvei's ( NVEI ) business quality, growth, price, and other factors.

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