U.S.-based software and services company Ebix, Inc. on Thursday entered into an agreement to acquire the Money Transfer Service Scheme (MTSS) business of India’s Transcorp International Ltd for about $7.4 million through one of its Indian subsidiaries.
The acquisition once approved, is expected to be accretive to Ebix earnings immediately. The company would fund the transaction using its internal cash reserves, it said in a statement.
This is Ebix’s fourth remittance related acquisition, following the announcement of the acquisition of YouFirst Money Express Private Limited and the asset purchases of Paul Merchants Limited and Wall Street Finance Limited. Ebix intends to consolidate all these acquisitions into its EbixCash financial exchange operations bringing significant synergies and reducing redundancies to the combined operation.
“We genuinely believe that EbixCash is a logical home for Transcorp MTSS assets, as it complements EbixCash’s financial exchange portfolio perfectly, opening up tremendous cross-selling opportunities on both sides,” said Transcorp Chairman and Managing Director Ashok Aggarwal.
The addition of Transcorp International MTSS assets following its acquisition of leading travel exchange Via.com, will increase the EbixCash financial exchange expanse to 231,500 physical distribution outlets, with an omni-channel online digital platform that encompasses leadership in money remittance (domestic & international), travel, pre-paid & gift cards, utility payments, etc., it said.
In addition, Ebix’s recent joint venture initiative with Bombay Stock Exchange positions it strongly in India’s insurance sector, it added.
“It will help establish EbixCash as an undisputed market leader, by leaps and bounds, in the inward international remittance exchange business. Also, the consolidation of Transcorp MTSS assets into our existing financial exchange infrastructure will further enhance our operating margins,” Ebix Chairman, President and CEO Robin Raina.
Ebix provides on-demand software and e-commerce services to the insurance, financial, e-governance and healthcare industries globally. Its subsidiary EbixCash claims to have domestic remittance volume of approximately $100 million per month, with a presence in prepaid cards, domestic remittances and bill payments, processing approximately 600,000 transactions per day and approximately $2 billion in annual payment volume.
Transcorp has prominent interests in international money transfer, foreign exchange, investments, insurance, and tours & travels and provides services via its network consisting of 40 offices and approximately 7,500 franchisee locations across India.