Equifax is acquiring a company with a unique database (40 million individuals – 140 million employment records), integration tools and processes, dependable outsourcing services for payroll and human resource functions.  TALX operates in a high-growth market. It had revenue growth of 30% in 2006, partly organic and partly through acquisitions.  The company has an excellent reputation with clients and a demonstrated commitment to safeguard and secure the data that it has entrusted to them.  Source: Equifax Press Release

Paying a premium of 6.7 times revenues, or 23 times EBITD is a bold move.  The reasons behind is probably the lacklustre performance of Equifax’s stock.  Equifax and D&B are approximately equal in size in terms of revenue and income.  Equifax’s market cap is approximately US$4.64 billion, while D&B’s market cap is approximately 5.23 billion.  Its biggest rival is Experian, who is way ahead in terms of revenue growth and broadening its product and services scope, analytical capabilities and integration tools.   Equifax seems to have finally woken up testing its luck in new outsourcing markets with cross selling opportunities.   BIIA Comment

BIIA Newsletter March – 2007 Issue