Rochester, N.Y.--(Sept. 20, 2002) -- Payroll services provider Paychex Inc., said it will acquire rival Advantage Payroll Services Inc., a privately owned payroll processor, for $240 million in cash.

Paychex will spend about $75 million in cash for the redemption of preferred stock and the repayment of outstanding loans. The company said it expects Advantage to contribute roughly $75 million in revenue over the next year.

The deal gives Paychex access to 49,000 Advantage's clients and, it hopes, the opportunity to cross-sell its human resource and retirement services products. It also expands the firm's geographic reach, noted B. Thomas Golisano, Paychex chairman and chief executive, who called the deal "a great fit for Paychex."

Advantage, which serves small to mid-sized businesses, has 41 offices nationwide, including 15 independently owned associate offices.

"The combination of Paychex and Advantage will enable us to provide a much broader range of services to our clients and allow us to improve our client efficiencies by utilizing the Paychex infrastructure," added Charles W. Lathrop Jr., Advantage chairman and CEO.

-- Electronic Accountant Newswire staff

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