Wolters Kluwer Governance, Risk & Compliance acquired eOriginal, a provider of cloud-based digital lending software, for approximately €231 million ($280 million) in cash.
Wolters Kluwer GRC’s compliance solutions business has had a strategic partnership with eOriginal since 2016, which allows the integration of eOriginal’s electronic vaulting and closing software with Expere.
eOriginal expects to achieve revenues of approximately €31 million in 2020 ($37 million, unaudited), of which almost 95% is recurring and cloud-based in nature. Revenues have grown at a double-digit organic growth rate in the last three years. The acquisition is expected to deliver a return on invested capital (ROIC) above Wolters Kluwer’s after tax weighted average cost of capital (WACC) of 8% within three to five years from completion and is expected to have an immaterial impact on Wolters Kluwer’s adjusted earnings in the first full year. Completion of the transaction is subject to customary closing conditions and expected before the end of 2020. The transaction will be effected through the purchase of eOriginal’s parent company, Paperless Transaction Management.
“Borrower preferences, competition among lenders and changing regulations are driving increased digitization of the lending workflow. eOriginal is well-positioned to take advantage of these systemic trends,” Steven Meirink, executive vice president and general manager of compliance solutions of Wolters Kluwer GRC, said. “The acquisition positions us as the leading provider of digital lending solutions, spanning all workflows from loan approval to document preparation and closing with compliance certainty.”
“eOriginal is a leader in digital loan solutions with a proven track record of growth and customer adoption,” Brian Madocks, CEO of eOriginal, said. “Digital lending continues to grow across all industries. Customers want and need purpose-built digital solutions that are complete and compliant. The combination of eOriginal and Wolters Kluwer provides exactly that — the right solution, in the right market, at the right time.”
