Vertex, Inc. (NASDAQ: VERX), a global leader in indirect tax solutions, has announced its public tender offer to acquire 100% of the shares of Pagero Group AB for 36 SEK per share, totaling approximately $555 million. This move represents a strategic expansion of Vertex’s capabilities in the rapidly evolving field of global tax compliance and e-invoicing.

Expanding the E-Invoicing Market Opportunity

The acquisition aligns with Vertex’s partnership with Pagero, initiated in October 2023, to deliver comprehensive solutions for multinational companies managing indirect tax, reporting, and e-invoicing compliance. With the rise of digital tax reporting mandates worldwide, e-invoicing has become a critical necessity for businesses operating in multiple jurisdictions. Pagero, known for its robust e-invoicing compliance solutions, will significantly enhance Vertex’s digital transformation capabilities and extend its leadership in the regulatory compliance landscape.

Combining Forces for Enhanced Compliance Solutions

Vertex CEO David DeStefano expressed enthusiasm about the acquisition, emphasizing the shared vision to accelerate global commerce and digitize compliance operations. The collaboration aims to create a seamless platform for the creation, exchange, and clearance of jurisdictionally-compliant e-invoices. This integration will enable companies to navigate complex compliance mandates more efficiently, expand geographically, and deliver value to shareholders.

Bengt Nilsson, CEO and co-founder of Pagero, highlighted the cultural alignment and shared values with Vertex. He anticipates that the combined strengths of both companies will better support customers and deliver significant shareholder value in the face of growing e-invoicing mandates and the digitization of indirect tax.

Strategic and Financial Benefits

The acquisition is poised to expand Vertex’s market opportunity from $22 billion to nearly $28 billion. It also advances the company’s international growth strategy, leveraging Pagero’s network across 140 countries. The transaction will create a comprehensive compliance platform combining indirect tax, filing, reporting, and e-invoicing, with a scalable business network for operational efficiencies.

Financing and Closing Details

Vertex plans to fund the acquisition using its existing revolving credit facility and issuing $500 million of Convertible Preferred Stock to Silver Lake, a global technology investment leader. The transaction is expected to close early in the first quarter of 2024, subject to regulatory approvals and customary closing conditions. Joe Osnoss, Managing Partner of Silver Lake, will join Vertex’s Board of Directors, further solidifying the strategic partnership.

  Bengt Nilsson, David DeStefano, Pagero Group, Silver Lake, tax compliance, Vertex