JOHNS CREEK, GA – May 24, 2017 – Ebix, Inc. (NASDAQ: EBIX), a leading international supplier of On-Demand software and E-commerce services to the insurance, financial, e-governance and healthcare industries, today announced that it has entered into a joint venture with India-based Essel Group, while acquiring an 80% stake in ItzCash, India’s leading payment solutions Exchange. ItzCash is recognized as a leader in the prepaid cards and bill payments space in India, besides being the only profitable payments solutions provider out of all its peers, while having grown at a CAGR of 35% over the last 3 years. The acquisition is expected to be accretive to Ebix earnings within the next 6 to 9 months.
Under the terms of the agreement, ItzCash was valued at a total enterprise value of approximately $150 million. Accordingly, Ebix acquired an 80 percent stake in ItzCash for $120 million including upfront cash of $76 million and a contingent earn out of up to $44 million payable over a period of 3 years from closing. The closing date of the transaction was May 23, 2017. The Company funded the transaction using internal cash reserves from its Indian and Singapore subsidiaries.
A leading driving force in the digitization of cash across India, ItzCash is a Financial Exchange for payment solutions that connects 75+ million consumers and 1,500+ corporate partners on its integrated payments solutions superhighway. With an Omni-channel strategy that encompasses a distribution network of 75,000+ physical retail outlets, the Company today is recognized as a leader in the prepaid cards and bill payments space. ItzCash processes approximately 600,000 transactions per day and approximately $2 Billion in annual payment volume, with an industry leading transaction success rate of 99%.
After a detailed due diligence and transaction support led by EY, Ebix decided to retain the entire management team led by the Managing Director of ItzCash Naveen Surya. With Ravi Singh as Chief Business Officer, Dayton Creado as CTO, and Bhavik Vasa as Chief Growth Officer leading the Company’s growth initiatives across multiple channels, the Ebix - Essel group joint venture intends to empower this highly experienced trio of seasoned senior executives, under the leadership of Naveen, to power ItzCash to become India’s largest Financial Exchange, with integrated offerings for insurance, healthcare and telemedicine. Naveen Surya also serves as the Chairperson for the Payment Council of India, an industry association for non-bank payment entities.
“With the youngest tech-savvy society, the largest middle class, a 1.3 billion population, a country committed to going digital and a growth rate of 7% plus, India is an emerging economic superpower today. We are big believers in the power of exchanges and thus have been keen to take an early position in India in terms of powering financial and insurance exchanges,” said Ebix Chairman, President and CEO Robin Raina. “In ItzCash, we found attributes that none of their peers had – market penetration across 3000 cities, 75,000+ brick & mortar distribution outlets, a CAGR of approximately 35% and the only company who was profitable amongst all its peers. With one of India’s most prominent business houses, the Essel Group deciding to align their interests with Ebix, the decision to invest in ItzCash became easy for us.”
Robin added, “We believe that the synergies between Ebix and ItzCash are at multiple levels and the ItzCash exchange when complemented with Ebix’s portfolio of insurance & healthcare services along with our international scale, will set the foundations of a very powerful and scalable business opportunity.”
ItzCash Managing Director Naveen Surya said, “We are thrilled to be associated with a world-leading exchange like Ebix and the opportunities that Ebix’s new investment in ItzCash offers us. This is a testament to our belief and roadmap for growth to deliver comprehensive financial services across emerging India. Having established our leadership across Payments, Remittances and Corporate Solutions already, we will deepen our foray now in the areas of credit, insurance, healthcare. We will continue to invest in our distribution network and technology, providing a fully integrated Financial Services Exchange.”
“Ebix’s global reach and operations opens International expansion opportunities for ItzCash. We are keen to replicate our proven model, technology platform and operating experience to other emerging markets for financial services” added Naveen Surya.
A leading international supplier of On-Demand software and E-commerce services to the insurance, financial, e-governance and healthcare industries, Ebix, Inc. provides end-to-end on-Demand solutions ranging from infrastructure exchanges, front end & back end enterprise systems, outsourced administrative & custom software development solutions, and risk compliance solutions for various entities involved in these industries.
With 40+ offices across Australia, Brazil, Canada, India, New Zealand, Singapore, the US and the UK, Ebix powers multiple exchanges across the world in the field of life, annuity, health and property & casualty insurance while conducting in excess of $100 billion in insurance premiums annually on its platforms. Through its various SaaS-based software platforms, Ebix employs hundreds of domain specific business and technology professionals to provide products, support and consultancy to thousands of customers on six continents. For more information, visit the Company’s website at www.ebix.com
Essel Group is among India’s most prominent business houses with a diverse portfolio of assets in media, packaging, entertainment, technology-enabled services, infrastructure development and education. The Group started business in 1926, and has since then metamorphosed into a conglomerate that is a symbol of the ingenuity and power of Indian entrepreneurship, with worldwide operations and a workforce of nearly 10,000 dedicated employees, with revenues of approximately $4 Billion.
An Ebix Group Company now, ItzCash Card Ltd., India’s leading Digital Payments fintech was established in 2006. A pioneer in the prepaid payments in India, ItzCash initiated the concept of ‘digital cash’ to the Indian consumer and various business entities, heralding the beginning towards enabling a cashless transacting society. ItzCash continues to build on its innovation augmenting its product portfolio offering wide choice of payments and money transfer service having issued 110 million accounts to date. It constantly invests in upgrading technology towards creating world-class Omni-channel payments platforms for the emerging India. ItzCash has presence across consumer segments serving 35 million consumers annually and over 75,000 franchisees branded as “ItzCash World” in 3000+ cities and towns. For further details, visit www.itzcash.com