Scott Hanselman

The Next Step: CheckFree to acquire Corillian for $245m

February 14, '07 Comments [10] Posted in Corillian | eFinance
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Big news over here at my company, Corillian. We're being purchased by CheckFree. This is pretty exciting from a technology company, with the challenge being to combine the software services of two companies.

I'm not a business person, nor is this blog about business, so I'll leave the analysis to the analysts. But from a technology perspective this is a very cool opportunity to combine and integrate the world's (IMHO) leading Banking Platform with the world's leading BillPay Platform. I'm stoked for the future.

CheckFree Announces Agreement to Acquire Corillian Corporation

Combination Will Enhance Online Banking, Billing and Payment Experience for Consumers and Small Businesses, and Deliver Greater Flexibility for Financial Institutions

ATLANTA and PORTLAND, Ore., Feb 14, 2007 /PRNewswire-FirstCall via COMTEX News Network/ -- CheckFree Corporation (Nasdaq: CKFR) today announced it has entered into a definitive agreement to purchase Corillian Corporation (Nasdaq: CORI), the leading provider of Internet banking software and services. Under the terms of the agreement, CheckFree will acquire all of the outstanding shares of Corillian at a price of $5.15 per share, for a total purchase price of approximately $245 million on a fully diluted basis.

The acquisition will bring together Corillian's widely used online banking platform and complementary suite of financial applications, and CheckFree's industry-leading electronic billing and payment and online transaction services, which include unparalleled electronic billing content and a highly efficient infrastructure that connects banks, billers and millions of consumers. Together, CheckFree and Corillian will be well-positioned to help financial institutions optimize the online channel and drive increased usage of electronic billing and payment.

<snip presidental and ceo quotes>

Corillian supports more than 30 of the top 100 U.S. banks and 21 of the top 100 U.S. credit unions with its online financial services strategy. CheckFree processes more than one billion transactions annually and distributes more than 18 million e-bills per month through more than 2,000 financial services sites.

The proposed acquisition is subject to regulatory review, Corillian shareholder approval, and other customary closing conditions, and is expected to close on or about June 1, 2007. CheckFree will finance the transaction with a combination of existing cash balances and revolving debt, although there are no financing contingencies in the merger agreement. CheckFree expects the transaction to be dilutive to CheckFree's GAAP earnings per share in the current fiscal year (ending June 30, 2007) and in 2008, and modestly dilutive to underlying earnings per share in the current fiscal year and in fiscal 2008. The company plans to share specific financial details when the transaction closes.

Conference Call

CheckFree will broadcast a conference call at 11 a.m. EST today to discuss the agreement. Participants should dial 1-877-232-1067 any time after 10:45 a.m. EST and ask for the CheckFree conference call. The live conference call will be accessible through the Investor Center section of the CheckFree website at http://www.checkfreecorp.com. A digital replay of the call will be available on the CheckFree website after 1 p.m. EST.

The Next Step begins...wish us all luck!

About Scott

Scott Hanselman is a former professor, former Chief Architect in finance, now speaker, consultant, father, diabetic, and Microsoft employee. I am a failed stand-up comic, a cornrower, and a book author.

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Wednesday, February 14, 2007 6:02:29 PM UTC
I've been through a couple of aquisitions before and calling them simple "challenging" from a technology perspective is an understatement, but in a good way. I hope the best of luck to you, and that you enjoy the approaching learning curve associated with those things.
Wednesday, February 14, 2007 6:03:41 PM UTC
Congrats and the best of wishes for continued success!
Wednesday, February 14, 2007 8:31:42 PM UTC
Wow. I hope you were getting some of your pay in stock.
John A. Davis
Wednesday, February 14, 2007 9:10:14 PM UTC
Does this mean you'll be cashing out your stock options and retiring to a life of leisure? ;)
Wednesday, February 14, 2007 10:40:55 PM UTC
Hope you had great stock options :)
Justin
Wednesday, February 14, 2007 11:05:13 PM UTC
Scott,

I hope you will still be actively blogging - your blog is an inspiration to many.
Best of luck.

Hitesh
Hitesh
Wednesday, February 14, 2007 11:22:27 PM UTC
Heh. I'm not going anywhere (at least, no one has told me I am!) Thanks for caring! :)
Scott Hanselman
Thursday, February 15, 2007 12:44:01 AM UTC
Sounds like (hopefully) there's a lot of work and a lot of fun with challenging stuff headed your way Scott. I sincerely wish things go right for you :)
Thursday, February 15, 2007 5:08:29 AM UTC
As the alpha geek for one of Corillian's clients, I've totally drank the Kool-Aid in terms of buying into Corillian's web services and Voyager platform vision. Here's hoping that our friends in Atlanta allow Corillian to continue along their existing roadmap without too much focus on the new stuff...

Scott, what's your speculation on what this does to your role as chief software architect?
Friday, February 16, 2007 3:12:33 AM UTC
in my (all too rich) experience with mergers and acquisitions (M and A), there's two basic scenarios:

scenario one: an M or A of one large competitor by another. One company is completely screwed and the other one is frustrated and overworked.

scenario two: an M or A of one business with a complementary business. (e.g. a tailored trouser company merges with a tailored jackets company to form a tailored suits company) Everyone is overworked, but invigorated by the challenges -- some small pockets of people are screwed (e.g. both companies have a button-making department -- the smaller of these will be eradicated, regardless of skill [see scenario one])

best of luck ofcourse... try to keep your head while all about you are losing theirs, etc.

lb
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Disclaimer: The opinions expressed herein are my own personal opinions and do not represent my employer's view in any way.