UBPS to buy payment companies for $179 million

(Reuters) - Universal Business Payment Solutions Acquisition Corp (UBPS.O), a blank check company, said it has agreed to buy three payment companies for $179 million, making its foray into providing transaction processing services to small businesses.

Blank check companies are formed to acquire one or more businesses through a merger, share exchange, asset acquisition, plan of arrangement or similar business combination.

UBPS said it will buy Electronic Merchant Systems, a credit and debit card sales company; Jet Pay LLC, a card processor; and two other related companies that offer tax filing and payment processing services.

UBPS will pay $104 million in cash and $38 million in newly issued common stock. The rest will be paid in the future on achieving certain targets, the company said in a statement.

The combined entity is expected to post revenue of $78.9 million in 2012.

UBPS will fund the transaction, expected to be completed in a year, by a $60 million credit facility and cash held in trust.

Shares of Chester County, Pennsylvania-based UBPS closed at $6.00 on Friday on the Nasdaq.

(Reporting by Eileen Anupa Soreng in Bangalore; Editing by Sreejiraj Eluvangal)