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Broadridge Financial Solutions To Buy DST's North American Customer Communications Unit for $410 Million

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Broadridge Financial Solutions, Inc. (NYSE: BR) revealed Tuesday that it reached a definitive agreement to buy the North American Customer Communications business of DST Systems, Inc. (NYSE: DST) for $410 million in cash. According to the company, NACC is a leading provider of customer communication services as the largest transactional printer in North America. That included print and digital communication solutions, content management, postal optimization, and fulfillment. The transaction is expected to close next month.

Broadridge disclosed that it sees the acquisition to be $0.01 to $0.03 a share accretive on a GAAP basis and $0.11 to $0.14 per share accretive on a non-GAAP adjusted basis in the first year. Similarly, for the second year, the company also expects the acquisition to be $0.09 to $0.13 per share accretive on a GAAP basis and $0.16 to $0.21 per share accretive on a non-GAAP adjusted basis.

The company's President and CEO, Richard Daly, commented, "This is the next step forward in Broadridge's journey, and it will create value for clients and shareholders in the near, medium and long term. Our goal has always been to be the premier, trusted provider to our clients, offering solutions that allow them to effectively, efficiently and securely communicate with their customers."

He continued, "The addition of NACC, an industry leader, is a natural extension of our communications business and will provide immediate benefits for our clients through enhanced production capabilities and expedited delivery times. This acquisition is consistent with our strategy and adds to our bottom line immediately. It also positions us to be a communications leader across a number of market verticals and a provider of a unique suite of multi-channel communications solutions, empowering Broadridge to accelerate the industry's conversion to digital communications and meet the diverse preferences of our clients' customers."

After the transaction is closed, the NACC business would become a part of Broadridge's Investor Communication Solutions business, establishing North America's premier customer communications technology platform. This would improve its position as a leading provider of multi-channel communications with exceptional scale in print communications and leading offerings for digital communications.

Last year 2015, the NACC business generated $1.1 billion of total revenue, and $445 million of fee revenue. The company added that Senior management, led by Mike Abbaei, Head of DST's Customer Communications business, would be joining Broadridge as part of this transaction.

 

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