iPayment Buys Transaction Solutions, Adds 4,000 Merchants

Nashville-based iPayment Inc., a publicly held independent sales organization that has executed a string of acquisitions over the past two years in the rapidly consolidating acquiring market, today announced its acquisition of Transaction Solutions LLC, a Pittsburgh-based ISO serving 4,000 small merchants with $500 million in annual card volume. No price was disclosed. Part of the appeal of Transaction Solutions to iPayment was its ability to add new merchants at the rate of about 250 per month, the company said in a statement. “Transaction Solutions brings us a substantial existing portfolio, as well as an innovative marketing approach,” Gregory S. Daily, iPayment chairman and chief executive, said in the statement. He added: “We will continue to evaluate additional transactions.” This latest acquisition brings to 100,000 the number of merchants in iPayment's portfolio. In a separate matter involving iPayment, a lawsuit filed against the company in the U.S. Bankruptcy Court in Los Angeles is scheduled for a hearing Oct. 21 before Judge Vincent Zurzolo. In the suit, filed last month, a bankruptcy trustee alleges iPayment's accountants engaged in fraudulent evaluation of the company's shares as part of a scheme to defraud creditors and investors before a public offering of the company's stock in March 2003. Accounting firms Ernst & Young and Arthur Andersen as well as other entities were named as defendants along with iPayment, which last month issued a statement calling the action “without merit” and promising to defend against it “vigorously.”