Payments company Melio is set to be acquired by Xero in a $2.5 billion deal.
In a significant move to strengthen its position in the US market, Xero, the global small business platform, has announced its acquisition of Melio, a leading Small and Medium Business (SMB) bill pay platform that integrates Accounting and Payments.
The deal, worth US$2.5 billion in cash and equity, will bring together Xero and Melio's teams across Accounting, Payments, and Melio's syndication network. Matan Bar, Melio's CEO and founder, will be responsible for the combined US business.
Xero's CEO, Sukhinder Singh Cassidy, expressed her excitement about the deal and looked forward to working with Melio's team. She believes this acquisition will allow Xero to accelerate its 3×3 strategy and provide Accounting and Payments on a longer-term basis to millions of US SMBs.
The combined US business will report to Xero's CEO and is expected to be funded through a mix of cash and equity. The deal's completion is expected within 6 months of signing.
The syndication model provides Xero with the opportunity to extend partnerships with providers such as Fiserv. Xero also plans to embed Melio's features into its core platform, aiming to offer a more comprehensive solution to its users.
The deal addresses a major customer need in the US by uniting Accounting and Payments on a single platform. This will enable SMBs, accountants, and bookkeepers in the US to gain more visibility and control over their cash flow, complete key Jobs to be Done (JTBD) seamlessly in one platform, and leverage Melio's Payments product.
Various regulatory conditions and approvals are applicable to the deal. Contingent consideration, deferrals, and rollovers are payable to Melio employees of up to $0.5 billion, payable over three years. The bank or financial institution involved in financing the acquisition of Melio Limited and its subsidiaries in collaboration with Xero has not been publicly disclosed.
Xero has entered into a binding agreement to buy 100% of Melio Limited and its associated entities. The deal is subject to customary conditions precedent to closing.
As part of the acquisition, Xero is committed to continuing to invest in Melio's Payments product. The company will also leverage its go-to-market expertise to accelerate growth in Melio and Xero in the US.
This acquisition marks a significant step forward for Xero in its mission to help small businesses thrive through better tools, information, and connections.
Read also:
- Understanding Hemorrhagic Gastroenteritis: Key Facts
- Stopping Osteoporosis Treatment: Timeline Considerations
- Trump's Policies: Tariffs, AI, Surveillance, and Possible Martial Law
- Expanded Community Health Involvement by CK Birla Hospitals, Jaipur, Maintained Through Consistent Outreach Programs Across Rajasthan
