The shake-out in e-commerce continued with Online Resources Corp. announcing a deal to acquire once high-flying electronic bill payment service provider Princeton eCom.
The purchase price is $180 million in cash with an earnout of $10 million. Online Resources plans to pair Princeton eCom with its own bill payment business. The combined company will serve 2,200 financial institutions and 1,600 billers, more clients than any other bill payment processor, according to Online Resources.
Princeton eCom, based in Princeton, N.J., was one of the first companies out of the box with an electronic bill payment and presentment service for financial institutions but the company has never reported a fiscal-year profit, racking up total losses of more than $60 million over the past five years.
The deal has been approved by three venture firms that control Princeton eCom, Mellon Ventures, LP, Conning Capital Partners and Lazard Technology Partners II LP.
Online Resources has obtained a commitment from Tennenbaum Capital Partners, LLC to fund its acquisition of Princeton under which Online will issue to Tennenbaum $85 million of senior secured notes and $75 million of convertible preferred stock.
