Wednesday, April 21, 2021
Barry McCarthy, president and chief executive officer at Deluxe, observed that the company's receivables-as-a-service generates more than $2.8 trillion annually and the One Deluxe initiative aims to further accelerate software and service growth.
"With electronic payments playing an increasingly important role across the economy, the addition of First American’s independent, leading payments platform will advance our One Deluxe strategy and our overall growth trajectory,” McCarthy said. “First American’s end-to-end payments platform presents significant cross-sell opportunities as we continue to invest in our higher growth payments segment, and this combination will create a multitude of opportunities to drive tremendous value for our shareholders.”
Neil Randel, chief executive officer of First American, thanked McCarthy for advancing the accomplishments of the First American team over the last 30 years. “I look forward to working closely with Barry, Mike and the team to exponentially grow our combined company and deliver enhanced value to all of our stakeholders,” he said.
McCarthy additionally noted, in a morning conference call and webcast, that the company's historic growth had been largely driven by acquisition, which changed when he became CEO in 2018. We paused on acquisitions, he stated, to deliver sales-driven growth and meet the following five prerequisites before doing any further acquisitions:
Deluxe executed on all five objectives, and during a global pandemic, and was ready to opportunistically augment its business with a transformative payment platform opportunity, McCarthy stated.
Michael Reed, president of payments at Deluxe, told The Green Sheet that combining Deluxe and First American capabilities will broaden the company's receivables-as-a-service and payables-as-a-service offerings to financial institutions, small and midsize businesses and hundreds of established enterprise clients.
"We recently launched the Deluxe Payment Exchange, which helps businesses send one-time payments where remittance status is required," Reed said, adding that the platform generated $16.4 billion in transaction value in 2020. And on the disbursement side, our payroll product dispersed $8.8 billion in value in 2020, he noted, and Deluxe added HR services to the payroll platform to help customers and merchants manage their businesses and employees all the way from hiring an employee to helping them retire and everything in between.
Ultimately, the First American acquisition will enhance everything Deluxe can offer in terms of helping a customer through their entire lifecycle of incorporation services, Reed stated, from building a website and designing a logo to helping independent software vendors run specific business software.
"With the First American acquisition, we will now be able to process credit, debit, and check payments, which really rounds out both companies' capabilities," Reed said. "It's 100 percent complementary to both of our businesses." 
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