A Portland-based payment processing company has settled a lawsuit brought by two international businesses after it backed out of a $1.7 billion deal by buying both for a third of the original price.
WEX Inc. initially backed out of the deal because of the financial impacts of the coronavirus pandemic, but will now buy the companies, eNett and Optal, for about $578 million, according to the Portland Press Herald.
ENett is an Australia-based company that offers payment services in the travel industry, and Optal is a London-based firm that optimizes business-to-business transactions.
This January, the fast-growing Portland company agreed to buy eNett and Optal from a New York hedge fund management firm to enhance its global growth.
But by June, a court in the United Kingdom sued WEX after it tried to pull out of the purchase, claiming WEX was violating the terms of the purchase agreement and had to go through with the transaction.
In October, a judge ruled that WEX could choose to not buy the companies if it argued at the trial that the COVID-19 pandemic had damaged eNett and Optal’s businesses to such a degree that it triggered a clause in the deal that allowed WEX to pull back.
However, the Portland company eventually ended up going through with the purchase at the significantly lower price. In a statement to the Press Herald, WEX said it expects the impact of the acquisition on adjusted net income to be immaterial next year.