VeriFone Systems Inc. (PAY) recently announced its acquisition of the assets of WAY Systems Inc. for $6 million. The purchase price also includes an earn-out of up to an additional $3 million payable in one year subject to certain targeted performances.
Founded in 2002, WAY Systems provides mobile Point of Sale (POS) solutions and gateway services for mobile merchants. The company was founded by Bill Merton, founder of VeriFone, with initial seed capital and received an additional $50 million in equity investments from Bessemer Venture Partners and Austin Ventures as well as debt financing from Lighthouse Capital Partners over the last seven years.
WAY has built up a customer base of more than 25,000 mobile merchants in the last five years who use the company’s compact mobile POS technology and gateway services. VeriFone expects that WAY’s intellectual property and reseller relationships will strengthen its mobile payment solutions business. The acquisition will help VeriFone expand its PAYware Connect Gateway infrastructure.
The acquisition will not have a material impact on VeriFone’s financial results. VeriFone will offer support for all existing WAY mobile systems through its extensive mobile portfolio, including PAYware Mobile and VX Evolution secure payment systems. VeriFone acquired the PAYware software product line from Trintech Group PLC in September 2006 to augment its server-based, enterprise payment software solutions. PAYware suite of software products provides software solutions that enable merchants, financial institutions and service providers to manage their electronic payment architecture efficiently.
PAYware Mobile is a hardware and software solution, which enables users to use a smartphone into a handy point-of-sale device. VeriFone has been selling its PAYware mobile iPhone solution through the Internet, Apple retail stores, and the direct sales channel.
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