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Intuit Buying Privately Held Mailchimp for $12 Billion

Combo will further expand offerings to small and medium sized businesses.

Tax and bookkeeping software maker Intuit  (INTU) - Get Intuit Inc. (INTU) Report said late Monday it will acquire Mailchimp, a privately held engagement and marketing company, for $12 billion in cash and stock to expand its offerings to small and medium sized businesses.

The combined companies will seek to offer a variety of key business services including marketing, managing customer relationships, cash management, and compliance.

“Together, Mailchimp and QuickBooks will help solve small and mid-market businesses’ biggest barriers to growth, getting and retaining customers," said Sasan Goodarzi, CEO of Intuit, in a statement. "Expanding our platform to be at the center of small and mid-market business growth helps them overcome their most important financial challenges. Adding Mailchimp furthers our vision to provide an end-to-end customer growth platform to help our customers grow and run their businesses, putting the power of data in their hands to thrive."

Intuit said it expects the transaction to be accretive to non-GAAP earnings per share for the full fiscal year 2022. The deal is expected to close by the end of Intuit’s fiscal 2022 second quarter, in January.

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The company said it will pay $300 million in assumed Mailchimp employee transaction bonuses with the remaining consideration payable in roughly equal parts of cash and Intuit common stock. Shares of Intuit will be valued at $562.61 each, the average price of Intuit in the five trading days ended Sept. 8.

At the close of the transaction, Intuit will issue $200 million of restricted stock units to Mailchimp employees.

Intuit said in the statement that it “expects the cash consideration to be financed through cash on hand and new debt of approximately $4.5 billion to $5.0 billion. The transaction is not expected to have an impact on Intuit’s existing dividend and share repurchase principles.”

Shares of Intuit rose $2.58, or 0.5%, to $560.00 in after-hours trading Monday.