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Great Hill Partners Makes All Cash Offer to Acquire Versapay Corporation

  • 8 min read

Toronto, ON – December 13, 2019 – Versapay Corporation (TSXV: VPY) (“Versapay” or the “Company”) and Great Hill Partners (“Great Hill”), a leading growth-oriented private equity firm, are pleased to announce that the Company and an affiliate of Great Hill have entered into a definitive arrangement agreement (the “Arrangement Agreement”) whereby Great Hill will indirectly acquire all of the issued and outstanding common shares of the Company (“Versapay Shares”) by way of a statutory plan of arrangement under the Canada Business Corporations Act (the “Transaction”).

Under the terms of the Arrangement Agreement, each Versapay shareholder (the “Versapay Shareholders”) will receive cash consideration of C$2.70 for each Versapay Share held (the “Consideration”), valuing Versapay’s total equity at approximately C$126 million on a fully diluted basis. The Consideration represents a 47.5% premium to the closing price of the Versapay Shares on the TSX Venture Exchange (the “TSXV”) on December 12, 2019 and a 64.5% premium to the volume weighted average price (“VWAP”) of the Versapay Shares over the last 30 trading days.

Benefits to Versapay Shareholders

  • Immediate and significant premium of approximately 47.5% to the closing price of the Versapay Shares on December 12, 2019, and approximately 64.5% based on the 30-day VWAP.
  • All cash offer that is not subject to a financing condition.

“We are very pleased to be able to recommend this transaction to our shareholders, employees and customers,” commented Art Mesher, Chairman of the Company, “With their deep knowledge of our industry and focus on supporting growth companies, Great Hill is uniquely positioned to understand our business and its long term potential, and help the Company to achieve that potential”.

“Great Hill is excited to partner with the Versapay team and provide the capital to execute on their growth strategies” stated Matt Vettel, Managing Partner at Great Hill Partners. Craig O’Neill, CEO of the Company added, “I’d like to thank our employees who have worked so hard to achieve the growth and success we’ve experienced to date, our customers who have put their trust in us, and our shareholders who have supported us as a public company. We’re equally excited about our future working alongside Great Hill.”

Independent Committee and Board of Directors Recommendations

An independent committee of Versapay’s Board of Directors (the “Committee”) comprised of Arthur Mesher, Sheldon Pollack and David Dobson was constituted to consider the Transaction. Capital Canada Limited has provided a fairness opinion to the Committee (the “Fairness Opinion”) stating that in its opinion, and based upon and subject to the assumptions, limitations and qualifications set forth therein, the Consideration to be received by the Versapay Shareholders pursuant to the Transaction is fair, from a financial point of view, to the Versapay Shareholders.

The Board of Directors, after receiving financial and legal advice, and following receipt of the Fairness Opinion and the unanimous recommendation of the Committee, has unanimously determined that the Transaction is in the best interests of Versapay and is unanimously recommending that Versapay Shareholders vote in favour of the Transaction.

In addition, directors and senior officers of Versapay, who as of the date hereof collectively hold approximately 3.7% of the Versapay Shares, have entered into agreements to support the Transaction and vote their Versapay Shares in favour of the Transaction.

Transaction Conditions and Timing

The Transaction will be implemented by way of a statutory plan of arrangement under the Canada Business Corporations Act and will require the approval of 66 2/3% of the votes cast by Versapay Shareholders at a special meeting of VersaPay shareholders to be called to approve the Transaction (the “Special Meeting”).

The completion of the Transaction will also be subject to obtaining required court and other approvals and satisfaction of closing conditions customary for a transaction of this nature. The Arrangement Agreement includes customary deal-protection provisions. Versapay is subject to non-solicitation provisions and in certain circumstances, the Board of Directors may terminate the Arrangement Agreement in favour of an unsolicited superior proposal, subject to the payment of a termination fee of C$5.67 million and subject to a right of Great Hill to match such superior proposal. The Arrangement Agreement also provides for payment by Great Hill of a reverse termination fee of C$7.56 million if the Arrangement Agreement is terminated in certain specified circumstances, including if Great Hill does not satisfy its obligation to provide sufficient funds to complete the Transaction.

It is anticipated that the Special Meeting will be held in February 2020. Following closing of the Transaction, the Versapay Shares would be delisted from the TSXV. The Transaction is expected to close in the first quarter of 2020.

Advisors and Counsel

INFOR Financial Inc. is acting as exclusive financial advisor to Versapay in connection with the Transaction. Capital Canada Limited provided the Fairness Opinion in connection with the Transaction. Cassels Brock & Blackwell LLP is acting as Canadian counsel to Versapay and Arnold & Porter Kaye Scholer LLP is acting as U.S. counsel to Versapay.

Blake, Cassels & Graydon LLP is acting as Canadian counsel to Great Hill and Alston & Bird LLP is acting as U.S. counsel to Great Hill.

Additional Information about the Proposed Transaction

A copy of the written Fairness Opinion, and a description of the various factors considered by the Board of Directors of the Company in its determination to approve the Transaction, as well as other relevant background information, will be included in the management information circular to be sent to the Company’s shareholders in advance of the Special Meeting. The management information circular, the Arrangement Agreement, including the plan of arrangement, and certain related documents will be filed with the Canadian securities regulators and will be available on SEDAR at www.sedar.com.

About Great Hill

Great Hill Partners is a Boston-based private equity firm targeting investments of $25 million to $500 million in high-growth companies across the consumer, digital infrastructure, financial technology, healthcare, and software sectors. Over the past two decades, Great Hill has raised nearly $8 billion of commitments and invested in more than 75 companies, establishing an extensive track record of building long-term partnerships with entrepreneurs and providing flexible resources to help middle-market companies scale. For more information, visit www.greathillpartners.com

About Versapay Corporation

Versapay is a Fintech company and leading provider of cloud-based invoice-to-cash solutions, enabling businesses to provide a superior customer experience, get paid faster, streamline financial operations, and dramatically reduce DSO and costs. Versapay ARC is the first platform to provide Customer-Centric ARC with a customer self-service environment to view invoices online, collaborate on inquiries and disputes, and facilitate secure online payments (EFT/ACH and credit card). Businesses gain access to a suite of powerful tools that enable efficient collections, cash application and real-time insight into accounts receivable. Versapay ARC automatically reconciles payments and account information through integrations with a wide range of ERPs and accounting software providers.

For more information:

John McLeod
Chief Marketing Officer
647 258 9406
[email protected]

Babak Pedram
Investor Relations
Virtus Advisory Group Inc.
[email protected]

Charlyn Lusk
Managing Director
Stanton Public Relations & Marketing
(646) 502-3549
[email protected]


This press release contains “forward-looking information” which may include, but is not limited to, statements with respect to the anticipated meeting date, timing for completion of the Transaction and delisting from the TSXV.

Generally, forward-looking information can be identified by the use of terminology such as “anticipates”, “believes”, “expects”, “plans”, “intends”, “estimates”, “schedules”, “forecasts”, “budgets”, “proposes”, or variations or comparable language of such words and phrases or statements that certain actions, events or results “may”, “could”, “would”, “should”, “might” or “will”, “occur” or “be achieved” or the negative connotation thereof.

Forward-looking information is based upon certain assumptions and other important factors that, if untrue or incorrect, could cause the actual results, performance or achievements of the Company to be materially different from future results, performance or achievements expressed or implied by such information. Such information is based on numerous assumptions regarding present and future business strategies and the environment in which the Company will operate in the future, including: the Company’s plans with respect to its products and services, including timing, content and pricing; market and industry expectations; a continuing increase in the number of customer relationships; the length of the sales cycles; the competitive environment; the ability to maintain or accurately forecast revenue from the Company’s products or services; the ability of the Company to identify, hire, train, motivate and retain qualified personnel; the ability of the Company to develop, introduce and implement new products as well as enhancements or improvements for existing products that respond, in a timely fashion, to customer/product requirements and rapid technological change; general economic, business and political conditions; stock market volatility; anticipated costs and ability to achieve goals; the impact of any changes in the laws and regulations in the jurisdictions in which the Company operates; and the effect of new accounting pronouncements or guidance. Although the Company believes its expectations are based upon reasonable assumptions and has attempted to identify important factors based on its current expectations, estimates and projections that could cause actual actions, events or results to differ materially from those described in forward-looking information, these are subject to a number of significant risks and uncertainties and there may be other factors that could cause actions, events or results not to be as anticipated, estimated or intended.

Forward-looking information is subject to known and unknown risks, uncertainties and other important factors that may cause the actual results, level of activity, performance or achievements of the Company to be materially different from those expressed or implied by such forward-looking information, including but not limited to risks related to: taxes, reliance on third-party service providers, potential failures of VersaPay and third-party systems, failure to develop or market new products or services, intellectual property, third-party claims for intellectual property infringement, privacy breach by service providers, merchant fraud, security breaches, service interruptions by cyber-terrorists or fraudulent or illegal use of services, competition, additional financing, variable revenues/earnings, dependence on key personnel, merchant attrition, loss of sales partners, increases in interchange rates, non-sufficient funds, market demand for products and services, changes in consumer spending, operating risk and insurance, conflicts of interest, stock price volatility, government regulations, litigation, general economic conditions, foreign exchange, liquidity, interest rates, internal controls and acquisitions strategy, as more particularly described in the section entitled “Risk Factors” in the Company’s Annual Information Form for the year ended December 31, 2018 dated April 2, 2019. The foregoing list is not exhaustive and other risks are detailed from time to time in other continuous disclosure filings of the Company. Should one or more of these risks or uncertainties materialize, or should assumptions underlying the forward-looking information prove incorrect, actual results may vary materially from those described herein as anticipated, believed, estimated or expected. Accordingly, readers should not place undue reliance on forward-looking information.

Although the Company has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking information, there may be other factors that cause actions, events or results to differ from those anticipated, estimated or intended. Forward-looking information contained herein are made as of the date of this press release and the Company disclaims any obligation to update any forward-looking information, whether as a result of new information, future events or results, except as may be required by applicable securities laws. There can be no assurance that forward-looking information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such information. Accordingly, readers should not place undue reliance on forward-looking information.

About the author

Katie Canton

Katie Canton has been helping companies develop and implement successful social media, content marketing, and marketing communications strategies for more than 10 years. Since joining VersaPay in 2018, she writes on topics such accounts receivables automation, Customer-Centric AR, collections management, and fintech.

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