Transaction further strengthens Tyler’s ability
to provide end-to-end solutions to local, state, and federal
governments
Expected to be accretive to Tyler’s non-GAAP
earnings and EBITDA in 2021
Tyler Technologies, Inc. (NYSE: TYL) and NIC Inc. (NASDAQ:
EGOV), jointly announced today that they have entered into a
definitive agreement under which Tyler will acquire all outstanding
shares of NIC in an all-cash transaction valued at approximately
$2.3 billion.
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the full release here:
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Under the terms of the transaction, which was unanimously
approved by the boards of directors of both companies, NIC
stockholders will receive $34.00 per share in cash, which
represents a premium of approximately 22% to NIC’s 30-day volume
weighted average price as of February 9, 2021, and a 14% premium to
the closing share price and 52-week closing high of $29.81 on
February 9, 2021.
NIC is a leading digital government solutions and payments
company, serving more than 7,100 federal, state, and local
government agencies across the nation. Headquartered in Olathe,
Kansas, NIC delivers user-friendly digital services that make it
easier and more efficient for citizens and businesses to interact
with government – providing valuable conveniences like applying for
unemployment insurance, submitting business filings, renewing
licenses, accessing information, and making secure payments without
visiting a government office. Leveraging its strong track record of
innovation, NIC helps government agencies rapidly deliver new
digital solutions to provide essential services to citizens and
businesses alike. In fiscal year 2020, NIC delivered revenues of
$460.5 million and net income of $68.6 million.
“The pandemic has accelerated the shift by governments to online
services and electronic payments as more citizens and businesses
are interacting digitally with government. NIC is uniquely
positioned with its deep expertise and robust digital solutions to
partner with us in making government more efficient and more
accessible to citizens,” said Lynn Moore, Tyler’s president and
chief executive officer. “Our companies share a vision for
thriving, connected communities, and our cultures are extremely
compatible. The combination will provide extensive benefits for the
clients, employees, and shareholders of both companies.”
“This announcement marks an exciting next chapter in our 30-year
history, and one that we believe will create significant value for
our government partners, employees, and stockholders,” said Harry
Herington, NIC’s chief executive officer and chairman of the board.
“The combined vision, strength, and resources of our companies will
accelerate our collective ability to provide innovative, efficient,
transparent services to local, state, and federal governments. With
this transaction, we are pleased to be able to deliver immediate,
premium cash value to our stockholders and we look forward to NIC’s
continued success as part of Tyler.”
Tyler’s strength in local government and NIC’s strength in state
government are highly complementary. Together, the combined company
expects to significantly expand its business with federal agencies
and leverage Tyler’s sales channels and client base to enhance
NIC’s scale and accelerate its strategy of bringing vertical
applications to clients. In addition, NIC has extensive expertise
and scale in the government payments arena, processing more than
$24 billion in payments on behalf of citizens and governments in
2020, which will accelerate Tyler’s strategic payments initiatives.
Tyler has a history of successful acquisitions, investing in and
growing acquired companies. Tyler expects NIC to continue to manage
its operations from its Olathe, Kansas, home office and to retain
its employees and leadership team.
Financing, Approvals and Timing
Tyler plans to fund the transaction with a combination of
approximately $700 million of cash on Tyler’s balance sheet and new
debt. Tyler has obtained financing commitments for a $1.6 billion
bridge facility with Goldman Sachs Bank USA and expects to replace
the bridge facility with permanent financing prior to closing. The
combination is expected to be accretive to Tyler’s non-GAAP
earnings and EBITDA, as well as recurring revenue mix and free cash
flow per share, in 2021.
The transaction is subject to the satisfaction of customary
closing conditions, including regulatory approvals and approval by
NIC’s stockholders. The transaction is expected to close in the
second quarter of 2021.
Advisors
Goldman Sachs & Co. LLC is serving as exclusive financial
advisor to Tyler, and Munck Wilson Mandala LLP is serving as legal
counsel. Cowen and Company LLC is serving as exclusive financial
advisor to NIC, and Shearman & Sterling LLP is serving as legal
counsel.
Conference Call
Tyler will discuss its fourth quarter 2020 results and the
acquisition during a conference call and webcast on Wednesday,
February 10, 2021, at 9:00 a.m. EST.
Participants can pre-register for the teleconference at the
following link: http://dpregister.com/sreg/10151750/e15a0630ce.
Registered participants will receive an email with a calendar
reminder, dial-in number, and PIN that allows immediate access to
the call on Wednesday, February 10, 2021.
Participants who do not wish to pre-register may dial
844-861-5506 (U.S. callers), 412-317-6587 (international callers),
or 866-450-4696 (Canada callers) and ask for the "Tyler
Technologies" call. A replay will be available one hour after the
call ends through February 17, 2021. To access the replay, please
dial 877-344-7529 (U.S. callers), 412-317-0088 (international
callers), or 855-669-9658 (Canada callers) and reference passcode
10151750.
The live webcast and archived replay can also be accessed at
https://tylertech.irpass.com/Presentations where presentation
charts will also be available shortly before the conference
call.
About Tyler Technologies, Inc.
Tyler Technologies (NYSE: TYL) provides integrated software and
technology services to the public sector. Tyler's end-to-end
solutions empower local, state, and federal government entities to
operate more efficiently and connect more transparently with their
constituents and with each other. By connecting data and processes
across disparate systems, Tyler's solutions are transforming how
clients gain actionable insights that solve problems in their
communities. Tyler has more than 27,000 successful installations
across more than 11,000 sites, with clients in all 50 states,
Canada, the Caribbean, Australia, and other international
locations. Tyler has been named to Government Technology's GovTech
100 list five times and has been recognized three times on Forbes'
"Most Innovative Growth Companies" list. More information about
Tyler Technologies, an S&P 500 company headquartered in Plano,
Texas, can be found at tylertech.com.
About NIC Inc.
NIC (Nasdaq: EGOV) is a leading digital government solutions and
payments company, serving more than 7,100 federal, state and local
government agencies across the nation. With headquarters in Olathe,
Kansas, and offices in more than 30 states, NIC partners with
government to deliver user-friendly digital services that make it
easier and more efficient to interact with government – providing
valuable conveniences such as applying for unemployment insurance,
submitting business filings, renewing licenses, accessing
information and making secure payments without visiting a
government office. In 2020, NIC securely processed 400 million
online transactions and more than $24 billion on behalf of
government agencies. In response to the COVID-19 pandemic, NIC also
developed more than 130 new solutions to address the needs of
government and those it serves, such as crisis communications,
pandemic unemployment, COVID-19 testing, and vaccine scheduling.
Learn more at www.egov.com.
Forward-Looking Statements
This communication contains “forward-looking statements” within
the meaning of the U.S. federal securities laws. Such statements
include statements concerning anticipated future events and
expectations that are not historical facts. All statements other
than statements of historical fact are statements that could be
deemed forward-looking statements. Forward-looking statements are
typically identified by words such as “believe,” “expect,”
“anticipate,” “intend,” “target,” “estimate,” “continue,”
“positions,” “plan,” “predict,” “project,” “forecast,” “guidance,”
“goal,” “objective,” “prospects,” “possible” or “potential,” by
future conditional verbs such as “assume,” “will,” “would,”
“should,” “could” or “may,” or by variations of such words or by
similar expressions or the negative thereof. Actual results may
vary materially from those expressed or implied by forward-looking
statements based on a number of factors, including, without
limitation: (1) risks related to the consummation of the
transaction, including the risks that (a) the transaction may not
be consummated within the anticipated time period, or at all, (b)
the parties may fail to obtain NIC stockholder approval of the
merger agreement, (c) the parties may fail to secure the
termination or expiration of any waiting period applicable under
the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as
amended, and (d) other conditions to the consummation of the
transaction under the merger agreement may not be satisfied; (2)
the effects that any termination of the merger agreement may have
on Tyler or NIC or their respective businesses, including the risks
that Tyler’s or NIC’s stock price may decline significantly if the
transaction is not completed; (3) the effects that the announcement
or pendency of the merger may have on Tyler or NIC and their
respective business, including the risks that as a result (a) NIC’s
business, operating results or stock price may suffer, (b) NIC’s
current plans and operations may be disrupted, (c) NIC’s ability to
retain or recruit key employees may be adversely affected, (d)
NIC’s business relationships (including, customers and suppliers)
may be adversely affected, or (e) NIC’s management’s or employees’
attention may be diverted from other important matters; (4) the
effect of limitations that the merger agreement places on NIC’s
ability to operate its business, return capital to stockholders or
engage in alternative transactions; (5) the nature, cost and
outcome of pending and future litigation and other legal
proceedings, including any such proceedings related to the merger
and instituted against NIC and others; (6) the risk that the
transaction and related transactions may involve unexpected costs,
liabilities or delays; (7) other economic, business, competitive,
legal, regulatory, and/or tax factors; and (8) other factors
described under the heading “Risk Factors” in Part I, Item 1A of
NIC’s Annual Report on Form 10-K for the fiscal year ended December
31, 2019, as updated or supplemented by subsequent reports that NIC
has filed or files with the U.S. Securities and Exchange Commission
(“SEC”). Potential investors, stockholders and other readers are
cautioned not to place undue reliance on these forward-looking
statements, which speak only as of the date on which they are made.
Neither Tyler nor NIC assumes any obligation to publicly update any
forward-looking statement after it is made, whether as a result of
new information, future events or otherwise, except as required by
law.
Additional Information and Where to Find It
This communication does not constitute an offer to sell or the
solicitation of an offer to buy any securities or a solicitation of
any vote or approval. This communication may be deemed to be
solicitation material in respect of the proposed transaction
involving Tyler and NIC. In connection with the proposed
transaction, NIC plans to file a proxy statement with the SEC.
STOCKHOLDERS OF NIC ARE URGED TO READ THE PROXY STATEMENT
(INCLUDING ANY AMENDMENTS OR SUPPLEMENTS THERETO AND ANY DOCUMENTS
INCORPORATED BY REFERENCE THEREIN) AND OTHER RELEVANT DOCUMENTS IN
CONNECTION WITH THE PROPOSED TRANSACTION THAT NIC WILL FILE WITH
THE SEC WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN
IMPORTANT INFORMATION ABOUT THE PROPOSED TRANSACTION AND THE
PARTIES TO THE PROPOSED TRANSACTION. Stockholders and investors
will be able to obtain free copies of the proxy statement and other
relevant materials (when they become available) and other documents
filed by NIC at the SEC’s website at www.sec.gov. Copies of the
proxy statement (when they become available) and the filings that
will be incorporated by reference therein may also be obtained,
without charge, by contacting NIC’s Investor Relations at
stevek@egov.com or 913-754-7007.
Participants in Solicitation
NIC and its directors, executive officers and certain employees,
may be deemed, under SEC rules, to be participants in the
solicitation of proxies in respect of the proposed merger.
Information regarding NIC’s directors and executive officers is
available in its proxy statement filed with the SEC on March 12,
2020. Other information regarding the participants in the proxy
solicitation and a description of their direct and indirect
interests, by security holdings or otherwise, will be contained in
the proxy statement and other relevant materials to be filed with
the SEC (when they become available). These documents can be
obtained free of charge from the sources indicated above.
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version on businesswire.com: https://www.businesswire.com/news/home/20210210005334/en/
Investor Relations Contacts:
Brian K. Miller Executive Vice President – CFO Tyler
Technologies, Inc. 972-713-3720 brian.miller@tylertech.com
Steve Kovzan Chief Financial Officer NIC Inc 913-754-7007
stevek@egov.com
Media Contacts:
Jennifer Kepler Senior Media Specialist Tyler Technologies, Inc.
972.713.3770 media.team@tylertech.com
Elizabeth Proudfit Senior Vice President, Marketing and
Communications NIC Inc 646-845-7356 eproudfit@egov.com
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