The $1.7 billion agreement includes about $1.275 billion in cash and roughly 2 million shares of WEX common stock paid to the sellers.
WEX is purchasing the Australian eNett from Travelport and its owners, partnered with Siris Capital Group and Elliot Management Corporation’s private equity affiliate, Evergreen Coast Capital Corp. U.K.-headquartered Optal’s acquisition by WEX is from private shareholders. Both startups will be fully combined under WEX.
“The combination of WEX’s travel business with eNett and Optal further strengthens our leadership in the global travel marketplace,” said WEX CEO and Chair Melissa Smith.
She added that the acquisitions solidify the company’s global presence and “adds a unique but complementary product suite” along with new talent that specializes in markets outside of the U.S. The acquisitions give WEX the potential for fast 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.”
Since 2016, eNett and Optal have combined growth of 36 percent. With the acquisitions, WEX anticipates long-term revenue growth of 10 percent to 15 percent.
Anthony Hynes, managing director and CEO of eNett, said the company is excited to work with WEX “to successfully integrate our complementary assets, including our technology, products, and most importantly, our people.”
Robert Bishop, managing director and CEO of Optal, said the combined firm “will be uniquely positioned to address the most complicated payment challenges of travel companies across the globe.”
The move positions WEX to establish a leadership position in the growing global travel market. Online travel bookings are expected to up about 9 percent per year through 2023, twice as fast as the travel market overall, according to the travel research firm Phocuswright.
October earnings for WEX met expectations, with its consolidated top line up 19 percent to just under $460 million. Adjusted earnings per share were $2.59, up 16 percent year over year.