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Bottomline Technologies Inc. says it plans to purchase Bank of America’s PayMode electronic invoice and payment product, as well as its operations and vendor network. As part of the deal, Bank of America will invest approximately $8.5 million in Portsmouth, N.H.-based Bottomline.
The deal also calls for the two companies to jointly run and market PayMode in a multi-year agreement under a software-as-a-service model. Bank of America will keep its existing PayMode clients and market PayMode to new customers. The Charlotte, N.C.-based banking giant has also joined Bottomline’s strategic advisory council.
Bottomline (Nasdaq: EPAY) exchanged warrants for one million Bottomline shares of Bank of America (NYSE: BAC) in the deal at an exercise price of $8.50 per share. According to a Bottomline spokesperson, the company will retain most of the employees of PayMode.
PayMode, a business-to-business payment network, already has 80,000 vendors, according to the companies. Approximately $300 billion in electronic transactions have been processed through PayMode since it was launched.
In March of 2008, Bottomline acquired Georgia company Optio Software Inc. in a deal worth $44.9 million. Optio is a provider of software to handle business processes that rely heavily on documents.
For 2008, Bottomline reported a loss of $5.1 million on revenue of $131.2 million.
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