Intuit Inc. (NASDAQ:INTU) announced today it has reached a definitive agreement to acquire Computing Resources, Inc. (CRI), the Reno, Nevada-based provider of payroll services. Under the terms of the agreement, Intuit will acquire the privately held CRI for approximately $200 million, consisting of cash and $25 million of Intuit stock.
"The acquisition of CRI advances our goal of being an essential resource for small businesses," said Bill Harris, president and CEO of Intuit. "With CRI, we gain an established platform to deliver high value, low-cost payroll services and can expand the suite of products our employer services group offers to small businesses.
"Intuit also gains the services of CRI's experienced management team and operations staff," said Harris. "Two years ago, we selected CRI to support the payroll service we offer to customers of QuickBooks software. We have seen first-hand the expertise they bring to payroll processing and their commitment to their financial institution distributors and customers. The acquisition is the next logical step in the evolution of our working relationship."
"CRI and Intuit share a common vision about how to serve and support small businesses," said Ranson Webster, chairman and CEO of CRI. "This opportunity paves the way for the combined organization to leverage the respective existing, successful strengths of both companies and their relationships. CRI offers enhanced benefits to Intuit by providing its services to a broader spectrum of businesses while Intuit can provide the infrastructure to support CRI's strategic alliances."
Since October 1998, Intuit has been offering payroll services including payroll tax filing, tax deposit services and direct deposit through CRI to its QuickBooks small business customers. CRI is one of the country's largest payroll services companies and a leader in providing payroll services to small businesses.
Some of the financial institutions Intuit works with are looking to expand their offerings to small businesses through Internet-based connectivity. "By providing these progressive financial institutions the ability to distribute new Internet-based services, we are enabling them to deepen their relationships with their small business customers," said Harris.
The acquisition, which has been approved by the boards of directors of both companies and the shareholders of CRI, is subject to regulatory approval and other closing conditions, including the expiration or waiver of certain rights of refusal. The acquisition is expected to close in the second calendar quarter of 1999.
CRI will operate as a wholly-owned subsidiary of Intuit, reporting through Jim Heeger, senior vice president of Intuit's small business division. Ranson Webster will continue as CEO of the subsidiary.
