INTUIT/ECH DROP DEAL Faced with problems stemming from Internet gambling legislation, Intuit and Electronic Clearing House have ended their merger by mutual agreement.
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The two companies agreed to merge in December after months of negotiations. But a law that went into effect last fall, the Unlawful Internet Gambling Enforcement Act of 2006, had caused Intuit to reduce its purchase offer. The act bars companies like ECH from transferring funds to betting sites. The company also cooperated in an investigation about customers who provide services to such sites.
PAYCHEX EARNINGS DROP
Paychex's decision to increase its litigation reserve by $13 million during the third quarter ended Feb. 28 cut about two cents per share off net income for the quarter. But earnings still rose almost 10 percent to $126.6 million from $114.5 million in last year's corresponding period.
The reserves were established to deal with two remaining suits that stem from Paychex's 2001 decision to stop supporting Rapid Pay. The company had reduced the reserve from $15.6 million to $200,000 in 2006 as it resolved litigation. Meanwhile, third quarter revenue rose to $485.3 million, up 12.7 percent from $430.6 million.
SMART PROS NET DOUBLES
An income tax benefit of $372,500 contributed to SmartPros' net income rising to $1.5 million for the year ended Dec. 31, more than double the $668,967 in earnings for 2005.
Meanwhile, revenue for the most recently ended year hit $12.5 million, up 19.5 percent from $10.4 million in 2005. Contributing to revenue growth were four acquisitions in the legal, banking/insurance, engineering and custom development markets that were completed last year. Also, on March 1 the company purchased most assets of the Selbst Group, which provides training programs in the financial services industry for $177,000.
FOREFIELD EXPANDS NEWSLETTER
Forefield has added content selections, formatting options and a broader email distribution reach to its newsletters for financial advisors.
The Marlboro, Mass.-based company increased the number of articles available for each newsletter issue, while it said that formatting controls made it easier to create customer articles and introductory notes while streamlining newsletter creation. Advisors can customize NASD-reviewed newsletter with their own contact information and elements such as logos, mastheads and pictures.
MORNINGSTAR BUYS FUND DATA
Morningstar has acquired the fund data business of Standard & Poor's for $5 million in cash.
The fund data business comprises data and products covering more than 135,000 management investment vehicles, including mutual, exchange-traded, hedge and offshore funds. Among these products are Workstation, a fund performance and analysis system for asset managers, and Data Feeds, a series of data licensed by institutions. Under the terms of the deal, S&P will license fund data from Morningstar.
INTUIT FLOATS BONDS
Intuit has issued $1 billion in five-year and 10-year senior notes in the financing of its recent acquisition of the online banking services company, Digital Insight.
The offering was split between $500 million five-year and $500 million 10-year senior notes. The proceeds were to repay the outstanding bridge debt that was used in the purchase.
WK SELLS ED GROUP
Wolters Kluwer has reached an agreement to sell its Education division to Bridgepoint Capital Limited for just over $1 billion.
WK, the Dutch parent of CCH, said that it would use about $634 million in proceeds to the shareholders through a share buy-back program and will use the remaining funds to reduce debt and to fund investments in opportunities to grow the company. The education division operates in seven European countries.