ATLANTA Netzee Inc., a provider of Internet banking and bill payment software, has agreed to buy John H. Harland Co.s Internet banking and bill payment business for about $16.8 million of stock.
The deal, expected to close by the end of this month, would boost Netzees individual customer base above 700,000 and the number of financial institutions using its products to more than 700. At the end of the second quarter Netzee had about 185,000 individual users and about 540 financial-institution customers.
We have been interested in forging a relationship with Harland for quite some time, and this acquisition became the ideal opportunity, said Glenn Sturm, Netzees chief executive officer.
In exchange for the Harland business lines, Netzee would issue 4.4 million shares of common stock to Harland, valued at $16.8 million as of Friday. The stock would be a 17% ownership stake, and Harland would get two seats on Netzees board of directors. Harland has also loaned Netzee $5 million in a secured note.
Harland of Decatur, Ga., which sells a suite of banking products, including check printing and marketing software, acquired the online banking business in August when it bought Concentrex Inc. of Portland, Ore.
Timothy C. Tuff, chairman and chief executive officer of Harland, said the deal will enable us to participate in the dynamic online banking arena while focusing our day-to-day attention on our core software business of delivery systems, host processing, financial intelligence, and mortgage services.