JOINT PRESS RELEASE
Published on June 23, 2008
Exhibit 99.2
Deluxe Corporation | ||
P.O. Box 64235 | ||
St. Paul, MN 55164-0235 | ||
(651) 483-7111 | ||
For additional information: | ||
Terry D. Peterson | ||
N E W S R E L E A S E
|
Deluxe Corporation | |
VP, Investor Relations and Chief Accounting Officer | ||
(651) 787-1068 | ||
June 19, 2008
|
Paul D. Engels | |
Hostopia.com Inc. | ||
VP and Chief Marketing Officer | ||
(416) 883-6706 |
Deluxe to Acquire Hostopia.com
Acquisition Provides Web-Hosting Capabilities for Small Businesses
Acquisition Provides Web-Hosting Capabilities for Small Businesses
St. Paul, Minn. and Mississauga, Ont. Deluxe Corporation (NYSE: DLX) and Hostopia.com Inc. (TSX:
H) today announced that they have entered into a definitive agreement for Deluxe to acquire
Hostopia, a leading provider of web services that enable small and medium-sized businesses to
establish and maintain an Internet presence. Deluxe will acquire Hostopia in an all-cash
transaction that values Hostopia at approximately C$124 million. Under terms of the Merger
Agreement, Deluxe will pay C$10.55 in cash for each outstanding Hostopia common share. Subject to
a final accounting allocation of the purchase price, the acquisition is not expected to have a
significant impact to Deluxes earnings and operating cash flow for fiscal 2008.
We are very excited with the prospect of providing Hostopias industry-leading, private-label web
services to our small business customers and collectively growing our product and service offerings
as we move forward together, said Lee Schram, Chief Executive Officer of Deluxe. Hostopia has
grown top line revenue in excess of 20 percent in each of the last three years. While we have
substantial knowledge and expertise in selling to the small business market, we believe that
Hostopias ability to attract new customers and provide additional services to that market will
increase the power of our offerings. This acquisition is in line with our long-term strategy of
broadening the products and services we offer to small businesses to manage, promote and grow their
businesses. We also believe that the transaction will offer significant value to our shareholders
as we continue to introduce growing products and services with recurring revenue streams.
Colin Campbell, Chief Executive Officer of Hostopia, said, After careful consideration, the
Hostopia Board of Directors has unanimously approved this transaction with Deluxe. We believe the
transaction delivers outstanding value to the Hostopia stockholders. Deluxe and Hostopia have many
similarities, including a desire to help small businesses grow and promote their businesses. Our
customers will benefit from augmented product and service offerings
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which include small business logo design, print-on-demand services and e-mail marketing, all of
which have demonstrated demand from small businesses. In addition, Deluxe brings access to new
channels for Hostopia including direct mail to small businesses and sales through financial
institutions. We look forward to providing web-hosting capabilities to small businesses as a
significant component of the services that Deluxe offers to those businesses.
The transaction, which has been unanimously approved by the Boards of Directors of both companies,
is structured as a merger under applicable law. It will require the approval of Hostopia
stockholders holding a majority of the outstanding Hostopia common shares at a special meeting to
be called to consider the transaction. Hostopia stockholders holding in aggregate approximately
35% of the issued and outstanding shares of Hostopia common stock have agreed to vote their
Hostopia common shares in favor of the transaction as long as the merger agreement is in effect,
pursuant to a voting agreement with Deluxe. The transaction is also subject to certain other
customary closing conditions. The transaction is expected to close in the third quarter of 2008.
About Deluxe Corporation
Deluxe Corporation, through its industry-leading businesses and brands, helps financial
institutions and small businesses better manage, promote, and grow their businesses. Deluxe uses
direct marketing, distributors, and a North American sales force to provide a wide range of
customized products and services: personalized printed items (checks, forms, business cards,
stationery, greeting cards, labels, and retail packaging supplies), promotional products and
merchandising materials, fraud prevention services, and customer retention programs. Deluxe also
sells personalized checks and accessories directly to consumers. For more information about Deluxe
Corporation, visit www.Deluxe.com.
About Hostopia.com Inc.
Hostopia.com Inc. is a leading provider of web services that enable small and medium-sized
businesses to establish and maintain an Internet presence. Hostopias customers are communication
services providers, including telecommunication carriers, cable companies, internet service
providers, domain registrars, and web hosting service providers. Hostopias customers purchase its
web services on a wholesale basis and resell these services under their own brands to small and
medium-sized businesses. Hostopia provides customers with the technology, infrastructure, and
support services to enable them to offer web services, while saving them research and development
as well as capital and operating costs typically associated with the design, development, and
delivery of web services.
Forward-Looking Statements
Certain statements contained in this release may be deemed to be forward-looking statements under
certain securities laws, including the safe harbor provisions of the United States Private
Securities Litigation Reform Act of 1995 and in any applicable Canadian securities legislation, and
Deluxe Corporation and Hostopia.com Inc. intend that such forward-looking statements be subject to
the safe-harbor created thereby. These forward-looking statements include, but are not
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limited to, statements with respect to the acquisition of Hostopia by Deluxe and statements
concerning Deluxes and Hostopias, or their managements, current intentions, expectations,
beliefs, projections or predictions about future results or events. Forward-looking statements are
typically identified by words such as believe, expect, forecast, anticipate, intend,
estimate, plan and project and similar expressions of future or conditional verbs such as
will, may, should, could, or would. By their very nature, forward-looking statements
require Deluxe and Hostopia to make assumptions and are subject to inherent risks and uncertainties
that are difficult to predict and are generally beyond the control of Deluxe and Hostopia, which
give rise to the possibility that certain predictions, forecasts, projections, expectations and
other forward-looking information, including statements about the acquisition of Hostopia by
Deluxe, will not be achieved. Deluxe and Hostopia caution readers not to place undue reliance on
these statements as a number of important factors could cause actual results or events to differ
materially and adversely from the beliefs, plans, objectives, expectations, anticipations,
estimates and intentions expressed in, or implied or projected by, the forward-looking statements.
These factors include, but are not limited to, the following: the possibility that the acquisition
of Hostopia by Deluxe does not close when expected or at all because required regulatory,
shareholder or other approvals are not received or other conditions to the closing are not
satisfied on a timely basis or at all; the risks and uncertainties associated with Deluxes ability
to complete the acquisition of Hostopia and to integrate Hostopia with Deluxe successfully; the
ability to retain key personnel; the inherent unreliability of earnings, revenue and cash flow
predictions due to numerous factors, many of which are beyond Deluxes and Hostopias control;
developments in the demand for the combined companies products and services; relationships with
major customers and suppliers; unanticipated delays, costs and expenses inherent in the development
and marketing of new products and services, including new e-commerce, customer loyalty and business
services, and the failure of such new products and services to deliver the expected revenues and
other financial targets; the impact of governmental laws and regulations; and competitive factors.
Readers are cautioned that the foregoing list of important factors is not exhaustive. Additional
information concerning these and other factors that could cause actual results and events to differ
from Deluxes and Hostopias current expectations are contained in Deluxes and Hostopias public
filings with the Securities and Exchange Commission, including but not limited to the factors
discussed under Risk Factors in Deluxe Corporations Form 10-Q for the period ended March 31,
2008 and Hostopias Form 10-Q for the period ended December 31, 2007 (each as updated by subsequent
filings with the Securities and Exchange Commission).
Except as required by law, Deluxe and Hostopia assume no obligation to update the forward-looking
statements contained in this release to reflect events or circumstances after the date hereof or to
reflect the occurrence of unanticipated events.
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