PayCycle becomes part of Intuit's small business group

Intuit Inc. announced that it has completed its acquisition of PayCycle, Inc., a provider of online payroll services for small businesses, accountants and financial institutions, serving more than 85,000 small businesses. The approximately $170 million acquisition expands the online capability of Intuit's payroll offering and strengthens the company's position as a provider of software as a service for small businesses.

Following an acquisition, PayCycle becomes part of Intuit's small business group, which serves more than 1 million small business payroll customers. And together, the companies are expected to accelerate the growth of Intuit's online payroll services and develop easy-to-use, next-generation tools to help small businesses be more efficient.

Besides, the acquisition is expected to reduce Intuit`s GAAP and non-GAAP earnings by approximately 2 cents per share in the fourth quarter of fiscal year 2009, which ends July 31. The charges primarily reflect costs associated with the write-down of software previously developed by Intuit and with integrating the two companies' workforces. However, Intuit does not expect the acquisition to have a material impact on fiscal year 2010 earnings.