If completed, this acquisition would effectively combine the payroll technologies of both companies to reach a greater swath of companies worldwide.
PayGroup processes roughly AU$11 billion in payroll per year for over 2,800 businesses. PayGroup’s international reach could work well in tandem with Deel’s valuation, which has reached $1.25 billion in just under 24 months, and its well-connected board of directors.
Deel is also planning on launching Deel Premium, a software that will increase the reach of global payroll and protect its clients from the risks of misclassification.
As it is seeking to launch a new program, Deel is simultaneously hoping to expand its audience and customer base to set the new program up for success.
This is what makes PayGroup an ideal fit, as it is well-situated in Asian markets, with around 400 employees who will join US-based Deel when the deal is completed.
According to the Market Herald, Deel offered to buy PayGroup in cash at one dollar each per share. The deal should be completed in October if all goes well.
The deal approval process will reach a final vote at a court-convened scheme meeting which is expected to be held in September 2022. According to PayGroup, its board has unanimously recommended that its shareholders vote in favor of the scheme, arguing that Deel’s acquisition is in the best interests of the shareholders.
Ian Basser, chairman of PayGroup said: “In making this assessment, the board, including the independent directors have carefully considered a range of matters, including its view of the intrinsic value of PayGroup and the certainty for shareholders of this all-cash offer.”
Currently, Deel is aiming to create a payroll offering with technology to let businesses consolidate their local entity payrolls into a dashboard that contractors and employees can use and view. According to Deel, PayGroup’s technology complements its future plans.
The company’s technology allows its customers to hire independent contractors and full-time employees in over 150 countries, taking the minutia of payroll and contracting out of the hiring process.
Speaking about the possible deal, co-founder and CFO of Deel, Philippe Bouaziz: “Together we will build the first truly global solution in the payroll industry, giving businesses around the world the ability to hire, pay, and manage the best talent, no matter where they’re located.
“PayGroup’s strong presence in countries like Australia, India, Singapore, and Japan will expand our customer base and reinforce our leadership in the global payroll space.”
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