WEX to acquire eNett and Optal for $1.7bn

April 2020 | DEALFRONT | MERGERS & ACQUISITIONS

Financier Worldwide Magazine

April 2020 Issue

In a combination which strengthens its leadership in the global travel marketplace, financial technology service provider WEX has acquired eNett, a leading provider of B2B payments solutions to the travel industry, and Optal, a company that specialises in optimising B2B transactions.

Under the terms of the definitive agreement, WEX will acquire eNett and Optal for a total consideration of approximately $1.7bn and approximately two million shares of common stock paid to the sellers. The cash portion of the transaction is being funded through a combination of cash on hand and new debt. The WEX common stock issued in connection with the transaction is valued at approximately $425m.

Furthermore, the acquisition of the two companies reduces WEX’s exposure to macroeconomic fluctuations, while providing geographic diversification in its travel business, which aligns with its strategy. Additionally, through this combination, WEX will have greater presence in Europe, the Middle East and Africa (EMEA) and Asia-Pacific (APAC) regions.

The combined enterprise is well-positioned to capture volume in the global travel market, and specifically the online travel market, which is expected to grow bookings at an estimated 9 percent per year until 2023.

“The combination of WEX’s travel business with eNett and Optal further strengthens our leadership in the global travel marketplace,” said Melissa Smith, chair and chief executive of WEX. “In particular, this transaction strengthens our position outside of the US, adds a unique but complementary product suite, and brings a talented team with expertise in operating in international markets.”

A leading financial technology service provider across a wide spectrum of sectors, including fleet, travel and healthcare, WEX operates in more than 10 countries and in more than 20 currencies through approximately 4900 associates around the world.

“We are pleased to be joining forces with WEX to offer leading travel companies globally an enhanced and unrivalled suite of innovative payments solutions,” said Anthony Hynes, managing director and chief executive of eNett. “We look forward to working with the WEX team to successfully integrate our complementary assets, including our technology, products and, most importantly, our people.”

Optal and eNett, which are already highly integrated companies, will be fully integrated under WEX’s ownership. “As a combined company, we will be uniquely positioned to address the most complicated payment challenges of travel companies across the globe,” said Robert Bishop, managing director and chief executive of Optal. “We are excited about the future and look forward to the opportunity to reach a broader set of customers.”

The transaction, which has been unanimously approved by the WEX board of directors, is expected to be completed in the middle of 2020, subject to regulatory approvals and other customary closing conditions.

Acting as financial advisers to WEX are BofA Securities and Grant Samuel. Clifford Chance and Wilmer Cutler Pickering Hale and Dorr LLP are acting as legal advisers. For eNett, Credit Suisse Securities (USA) LLC and LionTree Advisors are serving as financial advisers, with Wachtell, Lipton, Rosen & Katz serving as legal counsel. Herbert Smith Freehills is acting as legal advisers and Financial Technology Partners acted as advisers to Optal.

Ms Smith concluded: “We are confident this transaction will enable us to accelerate our growth by deepening and expanding our position in the global travel market, broadening our product offerings to more fully address the needs of our travel customers, and diversifying our business geographically while reducing our exposure to macroeconomic factors.”

Fraser Tennant