WEX to buy Payzer for $250 million

WEX, a leading payments and fuel card provider for small businesses, has agreed to buy Charlotte-based Payzer for $250 million.

Details: WEX, valued at around $7 billion, will pay $250 million plus an additional $11 million consideration based on performance. Payzer, co-founded by Joe Giordano and Doug Little, generates between $25 and $30 million in annual revenue and is growing at a 30% clip.

The logic: WEX has ~150,000 field service contractor customers (including those in HVAC and Plumbing), giving Payzer — whose product helps contractors manage jobs and improve collections — a big base of contractors to cross-sell into.

The deal enables WEX to strengthen its relationship with current customers, gives Payzer lots of room to run from a sales perspective, and opens the door for further integration in the future — benefitting both companies and their customers.

Melissa Smith, WEX’s CEO, noted that the acquisition is an example of WEX finding a high-growth market, a customer base that overlaps with theirs, and a great product offering to address the needs of those customers.

Why it matters for contractors: The tools to manage every business function — scheduling, credit card payments, fuel cards, and more — are colliding. As we covered recently, it’s likely that this activity will continue as vendors strike deals, form partnerships, and integrate their products.