(By Balaseshan) World Fuel Services Corp. (NYSE: INT), a global fuel logistics company, said it has agreed to buy select assets of Multi Service Corp., a transaction management company, for about $137 million.
The transaction is expected to be $0.12 to $0.16 accretive to earnings on a GAAP basis in the first twelve months. Non-GAAP accretion, which excludes amortization of acquired intangible assets of about $0.04 per share, is expected to be $0.16 to $0.20 in the first twelve months.
In conjunction with this acquisition, World Fuel Services will record one-time transaction-related expenses of about $2.8 million in the fourth quarter of 2012. Multi Service is expected to produce positive cash flow of $15 to $20 million in 2013 to World Fuel Services.
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The purchase price will be principally funded through the company's existing credit facilities. Multi Service specializes in fleet, government and commercial payment programs primarily through closed-loop networks.
Multi Service is headquartered in Overland Park, Kansas and has 360 employees. Multi Service, which processes more than eight million transactions annually, also maintains offices in the Netherlands and Australia.
The Multi Service product offering includes the Multi Service Fuel Card, accepted at more than 3,500 truck stops in the United States and Canada, Multi Service Tolls, payment solutions for tolls, bridges and tunnels across Europe, government payment systems for global fuel procurement, and commercial payment programs in the transportation and retail industries.
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The transaction is expected to be completed within the next thirty days.
INT closed Friday's regular session at $39.57. The stock has been trading between $33.65 and $49.15 for the past 52 weeks.