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Intuit to Sell Intuit Real Estate Solutions to Vista Equity Partners
MOUNTAIN VIEW, Calif. – Dec. 01, 2009 – Intuit Inc. (Nasdaq: INTU) has signed a definitive agreement to sell Intuit Real Estate Solutions to Vista Equity Partners for approximately $128 million in cash. Vista Equity Partners is a leading private equity firm with more than $2.5 billion in committed equity capital, focused on investments in software and technology-enabled businesses.
IRES, formerly known as Management Reports, Inc., is part of Intuit’s global business division and is a leading provider of software and services to companies in the real estate management and investment industry. Based in Highland Hills, Ohio, it has approximately 340 employees in its worldwide offices, serving more than 1,700 customers.
"Intuit Real Estate Solutions is a great business with a bright future," said Brad Smith, Intuit’s president and chief executive officer. "As we’ve focused our strategy on providing connected services that help consumers and small businesses, the Intuit Real Estate Solutions business model and the enterprise customers it serves are no longer a strategic, long-term fit for Intuit."
Vista Equity Partners’ strategy is to partner with well-positioned companies with best-in-class software products and related services and attractive market dynamics.
"We are long-term investors in enterprise application software businesses that are committed to being leaders in their markets," said Robert F. Smith, managing principal of Vista Equity Partners. "We are impressed by Intuit Real Estate Solutions’ suite of products, its track record of customer service and its global customer base. We look forward to working with them to help them reach their full potential."
The transaction, subject to regulatory review and customary closing conditions, is expected to close by the end of Intuit’s second quarter on Jan. 31. IRES will be treated as a discontinued operation.
Expected Impact on Fiscal Year Earnings
Intuit does not expect to change its fiscal year 2010 non-GAAP (Generally Accepted Accounting Principles) operating income or earnings per share guidance as a result of the sale. Intuit Real Estate Solutions’ contribution to Intuit’s non-GAAP operating income was approximately $4 million in fiscal year 2009 and was expected to be approximately $8 million in fiscal year 2010. Intuit expects that the approximately 2-cent reduction in non-GAAP earnings per share resulting from the sale of IRES will be offset by other savings.
Intuit Real Estate Solutions revenue totaled approximately $74 million in fiscal year 2009 and was expected to be approximately $80 million in fiscal year 2010. Intuit still expects its fiscal year 2010 revenue to grow between 4 and 8 percent when the IRES revenue is excluded from both fiscal year 2009 results and fiscal year 2010 guidance.
Intuit expects to record an increase of approximately 10 to 12 cents in GAAP earnings per share as a result of the sale, which is not expected to have a material effect on fiscal year 2011 earnings.
About Intuit Inc.
Intuit Inc. is a leading provider of business and financial management solutions for small and mid-sized businesses; financial institutions, including banks and credit unions; consumers and accounting professionals. Its flagship products and services, including QuickBooks®, Quicken® and TurboTax®, simplify small business management and payroll processing, personal finance, and tax preparation and filing. ProSeries® and Lacerte® are Intuit's leading tax preparation offerings for professional accountants. The company’s financial institutions division, anchored by Digital Insight, provides on-demand banking services to help banks and credit unions serve businesses and consumers with innovative solutions.
Founded in 1983, Intuit had annual revenue of $3.2 billion in its fiscal year 2009. The company has approximately 7,800 employees with major offices in the United States, Canada, the United Kingdom, India and other locations. More information can be found at www.intuit.com.
About Vista Equity Partners
Vista Equity Partners is a leading private equity firm that invests in dynamic, successful enterprise application software companies that are led by world-class management teams with a long-term perspective. With over $2.5 billion in committed equity capital, Vista Equity Partners is a value-added investor, contributing professional expertise and multi-level support toward its portfolio companies enabling them to realize their full potential. Vista Equity Partners’ investment approach is anchored by a sizable long-term capital base, experience in structuring technology-oriented transactions, and proven management techniques that yield flexibility and opportunity in private equity investing. They seek to align the interest of clients, management and shareholders and focus on the operational processes and best practices that are critical for long-term value creation. For more information, visit www.vistaequitypartners.com.
This news release includes forward-looking statements, which are subject to safe harbors created under the U.S. federal securities laws. All statements included in this press release that address activities, events or developments that Intuit expects, believes or anticipates will or may occur in the future are forward-looking statements, including, particularly, the expected effect of the transaction on Intuit’s earnings, operating income and revenue, the expected revenue generation of Intuit Real Estate Solutions in fiscal year 2010, statements about the potential benefits of the proposed transaction to Intuit Real Estate Solutions, and the expected benefits to Intuit Real Estate Solutions’ customers. All forward-looking statements are based on the opinions and estimates of Intuit's management at the time the statements are made and are subject to risks and uncertainties that could cause actual results to differ materially from those anticipated in the forward-looking statements.
These risks and uncertainties include: the risk that the conditions to closing might not be satisfied or may take longer to satisfy than expected; the risk that disruption from the transaction may make it more difficult to maintain relationships with customers, employees, partners or suppliers; the risk that the definitive agreement could be terminated by the parties in accordance with its terms; and the risk that the actual impact of the sale on our results could vary due to potential adjustments to the purchase price and other factors. For information regarding risks related to Intuit, see discussion of risks and other factors in documents filed by Intuit with the Securities and Exchange Commission from time to time, including Intuit's Form 10-K for the year ended July 31, 2009, available on Intuit's Web site at www.intuit.com/about_intuit/investors. Forward-looking statements represent the judgment of the management of Intuit as of the date of this release, and Intuit disclaims any intent or obligation to update any forward-looking statements.