Deluxe (DLX) investor relations material

Deal rationale and strategic fit

• Acquisition accelerates transformation toward high-growth payments and data segments, reducing reliance on the mature print business and increasing the share of revenue from these segments from 31% in 2020 to 57% in 2026 on a pro forma basis.

• Expands merchant services scale and scope, making the combined entity a top 10 non-bank US merchant acquirer by gross transaction volume and enhancing penetration into key merchant verticals and channels.

• Deepens go-to-market capabilities and broadens customer reach with an expanded network of partners and diversified distribution channels.

• Combines complementary technology platforms and customer service models, enhancing value for small and mid-sized business clients.

• The acquisition was chosen over organic growth to quickly strengthen market position and accelerate transformation.

Financial terms and conditions

• All-cash acquisition valued at $625 million, plus seller transaction expenses and adjustments, funded by $375 million in new term loan proceeds and available revolving credit facility capacity.

• Valuation is 7.4x trailing 12-month adjusted EBITDA, including expected cost synergies and tax benefits.

• Combined net leverage expected to be 3.9x at close, with a plan to return to 3x within two years.

• Transaction expected to be accretive to revenue growth, Adj. EBITDA margin, and Adj. EPS in the first year post-close.

• No changes to dividend policy or capital allocation priorities.

Synergies and expected cost savings

• Identified cost synergies exceed $15 million, to be fully realized within 24 months post-closing, driven by headcount efficiencies, streamlined technology and operations, and reduced real estate footprint.

• Additional revenue synergy upside is anticipated but not included in the base case.

• Synergies expected in back office, technology, operations, and customer support.

• Vendor and system consolidation will drive further efficiencies.