AvidXchange To Go Private For 22% Premium In M&A Deal
AvidXchange Holdings, Inc. (NASDAQ:AVDX) shares are trading higher premarket on Wednesday. On Tuesday, the company inked a deal to be acquired by Corpay, Inc. (NYSE:CPAY) and TPG Inc. (NASDAQ:TPG).
The acquisition price is set at $10 per share in cash, valuing AvidXchange at $2.2 billion, and reflects a 22% increase over AvidXchange's closing stock price of $8.20 on May 6, 2025.
It also represents a 16% premium compared to the 90-day average trading price up to that date and a 45% premium over the $6.89 closing price on March 12, 2025, the last trading day before potential transaction reports began circulating in the media.
Also Read: Corpay Interests Align Well With Mastercard: Analyst
According to the agreement, Corpay will invest around $500 million for a 33% ownership stake in the privatized company.
The transaction is anticipated to be finalized in the fourth quarter of 2025, subject to shareholder and regulatory approvals and the fulfillment of customary closing conditions.
The company anticipates this transaction will positively impact Corpay's earnings starting in 2026.
The structure of taking AvidXchange private offers Corpay the agility to implement changes and accelerate profit expansion.
Furthermore, Corpay retains the option to acquire the remaining ownership of AvidXchange in 2028.
Ron Clarke, Chairman and CEO of Corpay said, 'AvidXchange has over 8,500 highly satisfied customers in complementary verticals. It has a large merchant payment network with a combination of virtual card and ACH+ acceptance.'
'Additionally, we really like AvidXchange's business model: diverse revenue streams from payments and software, high retention rates, and very little working capital and credit exposure.'
John Flynn, Partner at TPG added, 'AvidXchange is addressing this need, providing a differentiated payment network and end-to-end tools that integrate seamlessly into workflows, enabling strong connectivity between businesses and their suppliers.'
As of March 31, 2025, Corpay's cash and cash equivalents stood at $1.55 billion.
Investors can gain exposure to the stock via Fidelity Disruptive Finance ETF (NASDAQ:FDFF) and Managed Portfolio Series Tremblant Global ETF (NYSE:TOGA).
Price Action: AVDX shares are up 18.41% at $9.71 premarket at the last check on Wednesday.
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