Paychex Inc. (NASD: PAYX) agreed to acquire Oasis Outsourcing Acquisition Corp., one of the largest professional employer organizations in the US.
The total cash purchase price is $1.2 billion, subject to working capital and other adjustments.
Paychex and Oasis will continue to operate as separate entities pending completion of the transaction.
The deal follows Paychex’s acquisition last year of PEO HR Outsourcing Holdings Inc.
Rochester, NY-based Paychex will now count more than 1.4 million worksite employees through its HR outsourcing services.
Oasis is headquartered in West Palm Beach, Fla., and has approximately 1,100 employees. It counts more than 8,400 clients nationwide using its HR solutions, employee benefits, payroll administration, and risk management services.
“This acquisition will strengthen our PEO growth strategy, gain scale for new products with our insurance carrier partners, provide a new client base to offer Paychex retirement and time and attendance products, and augment our experienced management team,” Paychex President and CEO Martin Mucci said. “This is a great time for our two companies to come together.”
Oasis in July acquired Aureon HR, a Midwest-based PEO service provider and a subsidiary of Aureon, its sixth acquisition since Stone Point Capital acquired the PEO in 2014. Private equity firm Kelso & Co. purchased a “significant” interest in the company last year, but Stone Point Capital remained the majority owner of the company, with the remainder owned by Oasis management.
The Oasis acquisition is subject to regulatory review and other customary closing conditions.