Global Payments to Acquire Active Network for $1.2 Billion; Sees Profits Rise Nearly 8%

Global Payments Inc. said Thursday that it has a deal to buy two major divisions of Active Network LLC, a growing event-management software provider and payment processor, for $1.2 billion from a private-equity firm. The merchant acquirer also reported its second-quarter financials, which include a nearly 8% year-over-year increase in net income.

Dallas-based Active processes registrations and online payments for event organizers, including sponsors of outdoor activities and sporting and health-related events, and provides cloud-based software for event management. Founded in 1999, Active operates in 74 countries and services 620,000 activities for 36,000 merchants. Event registrations are running at 51 million annually, according to a Global Payments press release.

Despite its size, Active Network currently has only 5% to 7% of a market that Atlanta-based Global Payments estimates at $60 billion in payment volume.

“Active Network aligns perfectly with our technology-enabled, software-driven strategy, and complements our existing businesses well,” Global Payments chief executive Jeff Sloan said in a statement. “With Active Network, we are adding an enterprise software business operating in two new vertical markets that are highly fragmented and under-penetrated with attractive growth fundamentals.”

Sloan added that the acquisition will enhance Global’s position as a payments partner with software developers, a market where the company already is a major player. “This represents a unique and exciting opportunity to integrate our distinctive payment technologies with a number of leading enterprise software companies to enhance their solutions and drive further market-share gains,” he said.

Under terms of the pending deal, Global Payments will pay $600 million in cash and $600 million in stock to Austin, Texas-based Vista Equity Partners. Global Payments is buying the sports and communities units of Active, while Vista, which acquired privately held Active in 2013, will retain the outdoor division. The effective purchase price after factoring in a tax asset is $1 billion. Global Payments expects the deal to close in the fourth quarter.

Meanwhile, Global Payments reported second-quarter net income of $66.9 million, an increase of 7.5% from $62.2 million a year earlier, on revenues of $962.2 million, up 14.2% from $842.6 million. North American revenues grew 13.9% to $711 million.