“We believe TPG is a great acquisition for our investors and the
customers and business partners of both entities,” said
Mr. Streit continued, “In addition to the expected economic benefits, we believe this acquisition is strategically compelling. The segment of consumers who utilize TPG’s services are highly correlated to Green Dot’s customer segment of LMI American families. As a point of reference, more than 50% of all tax refunds loaded to Green Dot’s prepaid cards in the most recent tax season were processed by TPG. Furthermore, in the same period, we believe the majority of tax refund dollars loaded to all prepaid cards industry-wide were processed through TPG. Given the strong correlation between customer segments, we believe that, over time, there is a significant revenue opportunity in bundling Green Dot’s award winning prepaid cards and checking accounts along with TPG’s industry leading consumer tax refund processing services.”
“TPG is known for treating its partners, customers and industry
stakeholders with dedication, transparency, integrity and a mission to
provide highly valuable and highly trusted processing and settlement
services to the tax industry. Green Dot is the perfect match for our
business since it too shares a mission of dedication and integrity
towards its customers and business partners. Furthermore, we believe
Green Dot’s industry-leading product suite, its award-winning technology
capabilities, its strong financial resources, and its well-known and
trusted national brand name will likely provide meaningful growth and
long-term sustainability for our partners and for our business,” said
TPG - America’s Largest Consumer Tax Refund Transaction Processor
TPG is integrated as the tax refund processing and settlement engine for
4 out of the 6 leading consumer online and in-person tax preparation
companies. Additionally, TPG’s services are integrated into the
offerings of the nation’s leading tax software companies, which,
together, enable TPG to serve nearly 25,000 independent tax preparers
and accountants nationwide. In the most recent tax season, TPG processed
approximately
Transaction Details
Green Dot has entered into a definitive agreement to acquire TPG for a
closing purchase price of approximately
Green Dot provides annual guidance during its Q4 earnings call,
typically held within the first two months of each calendar year.
Accordingly, Green Dot will not be providing consolidated 2015 guidance
until next year. However, for illustrative purposes only, based on 2015
Thomson Reuters First Call consensus estimates for Green Dot and without
directly or indirectly endorsing or concurring with such forecasts, the
transaction is expected to generate mid-teens percentage accretion to
non-GAAP diluted earnings per share in 2015. The acquisition is expected
to close within sixty days, subject to customary closing conditions.
Additional details, including the financial impact to Green Dot’s
full-year financial results and a revised full year outlook, may be
found in a separate press release issued by Green Dot on
BofA Merrill Lynch acted as financial advisor to Green Dot and
1 Based on 2015 Thomson Reuters First Call consensus estimates. Please note that any projections of the Company's performance relative to First Call consensus estimates in this press release are for illustrative purposes only. Forecasts regarding the Company's performance made by analysts within the First Call consensus group are theirs alone and do not represent forecasts or predictions of the Company or its management. Green Dot does not by its reference to First Call consensus estimates imply its endorsement of or concurrence with such forecasts.
Conference Call
The Company will host a conference call to discuss the acquisition
today,
Forward-Looking Statements
This announcement contains forward-looking statements, which are subject
to the safe harbor provisions of the Private Securities Litigation
Reform Act of 1995. These statements include, among other things,
statements regarding the potential benefits of the acquisition of TPG
including its accretive impact on non-GAAP diluted earnings per share,
the tax benefits expected to be derived therefrom, the potential for
improved margins and cash generation, and its effects on the Company’s
growth. Actual results may differ materially from those contained in the
forward-looking statements contained in this announcement. The potential
risks and uncertainties that could cause actual results to differ from
those projected include, among other things, the businesses of the
Company and TPG may not be combined successfully, or such combination
may take longer, be more difficult, time-consuming or costly to
accomplish than expected; the risk that the acquisition of TPG may not
occur or that sales of TPG products will not be as high as anticipated;
the expected growth opportunities or cost savings from the acquisition
may not be fully realized or may take longer to realize than expected;
customer losses and business disruption following the acquisition,
including adverse effects on relationships with former employees of TPG,
may be greater than expected; the risk that the Company may incur
unanticipated or unknown losses or liabilities if it completes the
acquisition of TPG; and the risk that legislative or regulatory changes,
or changes in the way the existing legislation and regulations are
interpreted or enforced, may adversely affect the business in which TPG
is engaged. Additional factors, that could cause actual results to
differ materially from those expressed in the forward-looking statements
include the impact of the Company’s supply chain management efforts on
its revenue growth, the timing and impact of revenue growth activities,
the Company's dependence on revenues derived from Walmart and three
other retail distributors, impact of competition, the Company's reliance
on retail distributors for the promotion of its products and services,
demand for the Company's new and existing products and services,
continued and improving returns from the Company's investments in new
growth initiatives, potential difficulties in integrating operations of
acquired entities and acquired technologies, the Company's ability to
operate in a highly regulated environment, changes to existing laws or
regulations affecting the Company's operating methods or economics, the
Company's reliance on third-party vendors, changes in credit card
association or other network rules or standards, changes in card
association and debit network fees or products or interchange rates,
instances of fraud developments in the prepaid financial services
industry that impact prepaid debit card usage generally, business
interruption or systems failure, and the Company's involvement in
litigation or investigations. These and other risks are discussed in
greater detail in the Company's
About Non-GAAP Financial Measures
To supplement the Company's consolidated financial statements presented
in accordance with accounting principles generally accepted in
About Green Dot
About
Source:
Investor Relations
Christopher Mammone, 626-765-2427
IR@greendot.com
or
Media
Relations
Brian Ruby, 203-682-8286
Brian.Ruby@icrinc.com