In a major acquisition that promises to reshape the future of finance software, Paylocity has agreed to purchase corporate expense startup Airbase for $325 million. The deal between the HR platform leader and growing financial services provider signifies expanding opportunities at the intersection of human resources and CFO operations.
Subject to regulatory approval, the all-cash transaction is expected to close within the next two months. Paylocity plans to fund the purchase through existing credit lines. For Airbase, the acquisition marks a successful exit after years of steady growth serving medium-sized firms.
Founded in 2017, Airbase developed an integrated platform to streamline corporate spending. Features included bill payment, expense management, and reimbursement functions. Through its software, the San Francisco company helped finance teams gain visibility and control over budgets. After raising over $100 million, Airbase attained a high valuation but saw the potential for greater impact through joining forces with Paylocity.
Headquartered outside Chicago, Paylocity has built an extensive customer base of over 40,000 organizations using its core HCM software. As a publicly traded firm valued at nearly $9 billion, Paylocity possesses the resources to take Airbase's solutions to new heights. Company leaders view the deal as an opportunity to expand their total addressable market by delivering unified HR and financial management tools to medium-sized businesses.
Industry analysts view the acquisition positively, believing the combined company can better serve customers operating at the intersection of HR and finance departments. Both firms have earned strong reputations for supporting mid-market clients, and together they are well-positioned to streamline processes across the workplace. With over 300 employees already, Airbase is expected to significantly contribute to Paylocity's innovation and service capabilities.
Details on how many Airbase staff may join Paylocity were not disclosed. However, the transaction structure provides compensation for shareholders, employees and the balance sheet. Overall, the agreement underscores the ongoing significance of combining forces to bring powerful new software offerings to business customers.
