C.H. Robinson Sells Payment Services Biz for $302.5M
Eden Prairie-based transportation and logistics company C.H. Robinson Worldwide, Inc., has sold its payment services business, T-Chek Systems, Inc., for $302.5 million in cash.
The buyer, Nashville, Tennessee-based Electronic Funds Source, LLC (EFS), acquired both the assets and “assumed certain liabilities” of T-Chek through the deal, which closed Tuesday, C.H. Robinson said.
T-Chek, which has been a subsidiary of C.H. Robinson since 1984, is a business-to-business provider of spend-management and payment-processing services. Its technology supports tools related to funds transfer, vendor payment, fuel purchasing, and online expense management.
EFS, meanwhile, provides customized payment solutions that are designed to meet the needs of the transportation industry and that are accepted at more than 10,000 locations in North America.
According to C.H. Robinson, T-Chek initially focused on customers in the trucking industry. But it has since expanded its business into the financial services sector and now offers funds transfer and expense management for other industries through one of its key products.
“We are proud of T-Chek’s success and of T-Chek’s employees, who built a very strong business with a long track record of growth,” C.H. Robinson CEO John Wiehoff said in a prepared statement. “As the payment services industry continues to consolidate and evolve, scale and alignment with the financial services sector are becoming increasingly important. EFS is an excellent organization and we felt, for T-Chek’s long-term success, that strategically it was the right time for T-Chek to join forces with EFS.”
T-Chek has 190 employees, most of whom are based in Minnesota. C.H. Robinson said that EFS expects to retain a presence within the state and that T-Chek’s management will assume “key roles” at EFS. An EFS representative couldn’t immediately be reached mid-day Wednesday, so it’s unclear whether any jobs will be moved out of the Twin Cities.
C.H. Robinson said that it previously purchased services from T-Chek, including those related to employee expense cards and advancing funds to its contract carriers. The company recently entered into a contract to purchase those services from EFS.
T-Check’s 2011 net revenues totaled $49.3 million, and its operating income was $24.6 million. For the first three quarters of this year, sales totaled $39.4 million and income from operations amounted to $19.4 million.
C.H. Robinson is among Minnesota’s 15-largest public companies based on revenue, which totaled $10.3 billion in 2011. Last month, the company made headlines when it announced plans to purchase two freight services companies—Poland-based Apreo Logistics, S.A., for an undisclosed sum, and Chicago-based Phoenix International, Inc., for $635 million.