Israeli payments and loyalty platform Nayax has acquired California-based Retail Pro, a specialist in retail point-of-sale (PoS) software, for $36.5m.

The acquisition should expand the scope of Nayax’s retail business to more than 9000 retailers with approximately 150,000 PoS lanes in more than 100 countries, including access to a worldwide partner ecosystem of over 80 distributors.

The purchase price for the transaction represents an implied enterprise value of $36.5m on a cash-free debt-free basis, to be paid partially in cash and the remainder in cash or equity, subject to certain earnout targets being met. The deal is expected to close before the end of the year, subject to customary closing conditions.

“Throughout their 30+ year brand history, Retail Pro has built a full featured, flexible product, capable of handling the complex, global retail environment,” said Yair Nechmad, Nayax CEO. “This has resulted in their powerful brand recognition as premier retail management for tier-one global retailers. We are pleased to be joining forces with Retail Pro’s talented expert team. Our combined businesses, together with Retail Pro’s 80 distributors, will triple our access to the global attended retail market and create a powerful and complete solution with Nayax’s payment and loyalty platform.”

Kerry Lemos, CEO of Retail Pro, added: “We are pleased to be part of a great company like Nayax, which shares our dedication to continued product innovation and customer experience. Over the years, customers have come to trust our robust technology platform to optimise their complex retail operations. As part of a larger, multinational organisation, we can continue to deliver on that mission on a much larger scale. We look forward to working closely with Nayax’s team, as this coalition represents an ideal fit and strong win for our customers, partners and employees globally.”

The global retail industry continues to benefit from embedded payment trends and strong demand for payments and PoS systems. Global retailers continue to need multi-functional PoS systems with management capabilities.

The acquisition should lead to the cross-selling of Nayax’s payment platform into Retail Pro’s large distributor and customer base.

Given the expected closing of the transaction in Q4 2023, there is no expectation of a material impact on 2023 revenue or adjusted EBITDA.

Both Nayax and Retail Pro have received unanimous approval by each company’s governing body for the transaction.

The purchase price for the transaction represents an implied enterprise value of $36.5m on a cash-free debt-free basis. Nayax expects $2m of deferred revenue to be treated as a reduction to the purchase price. The purchase consists of an initial payment of approximately $20m in cash at closing and the remainder, subject to certain earnout targets being met, paid over three years in either cash or equity as determined by Nayax. Nayax expects to finance the initial payment with already committed bank financing.

In 2022, Retail Pro generated approximately $14m in adjusted revenue and approximately $4m in adjusted EBITDA.

Nayax (www.nayax.com) is a commerce enablement, payments and loyalty platform designed to help merchants scale their business. It includes localised cashless payment acceptance, management suite and loyalty tools, enabling merchants to conduct commerce anywhere, at any time. The company has nine global offices, approximately 800 employees, connections to more than 80 merchant acquirers and payment method integrations, and is a recognised payment facilitator worldwide.

Retail Pro (www.retailpro.com) has a 30+ year brand history in in retail PoS software and offers an integrated platform and retail software to help retailers not only accept payments, but also optimise business operations and transform their customer experience with deep insights from integrated data.