Paychex Completes $4.1 Billion Acquisition of Paycor to Boost HCM Market Reach

Paychex has finalized its acquisition of Paycor for approximately $4.1 billion in cash, marking a major consolidation in the human capital management (HCM) software space. The transaction strengthens Paychex’s competitive positioning among mid-sized and larger enterprise clients and expands its revenue channels and capabilities.

Key Deal Highlights:

- Paycor shareholders received $22.50 per share in cash.
- The combined company will offer the industry's most comprehensive HCM portfolio.
- Over $80 million in annual cost synergies expected in fiscal 2026.
- Anticipated to be accretive to Paychex’s adjusted diluted EPS by fiscal 2026.

Strategic Rationale:

CEO John Gibson emphasized that this move brings together two industry leaders with strong AI-driven technology and advisory services. The integration will focus on accelerating product innovation and expanding sales reach.

Paychex plans to maintain its dividend policy and financial discipline, signaling confidence in post-deal stability and future growth.

Paychex, Inc. Completes $4.2 Billion Senior Notes Offering

Rochester, NY – Paychex, Inc. (Nasdaq: PAYX), a leading provider of integrated human capital management solutions, announced the successful completion of a $4.2 billion senior notes offering on April 10, 2025.

The offering includes:

$1.5 billion of 5.100% senior notes due 2030

$1.5 billion of 5.350% senior notes due 2032

$1.2 billion of 5.600% senior notes due 2035

The notes were offered pursuant to an effective registration statement on Form S-3, filed with the Securities and Exchange Commission, and were priced via a prospectus supplement dated April 8, 2025.

The offering was underwritten by a syndicate led by J.P. Morgan Securities LLC and BofA Securities, Inc., with additional participation from several other underwriters. The company issued the notes under an indenture agreement with The Bank of New York Mellon Trust Company, N.A., serving as trustee.

The proceeds of the offering are expected to be used for general corporate purposes, including potential debt refinancing, capital expenditures, and working capital needs.

Paychex Files Accounting Firm Consent Related to Paycor Merger

Paychex, Inc. has filed a consent from Ernst & Young LLP, the independent auditor for Paycor HCM, Inc., in connection with the companies' pending merger. The consent relates to the inclusion of Ernst & Young’s audit report on Paycor’s June 30, 2024 financial statements in Paychex’s Form S-3 registration statement (No. 333-286249). This administrative step supports the ongoing integration process outlined in the January 7, 2025 merger agreement between Paychex and Paycor.

Paychex Posts Strong Q3 Results, Moves Toward Paycor Acquisition

Paychex reported a 5% year-over-year increase in third-quarter revenue, reaching $1.51 billion. Adjusted operating income grew 9% to $708.5 million, while adjusted diluted earnings per share rose 8% to $1.49. The company credited its momentum to strength in its HCM solutions and continued investment in automation and AI.

Operating margin improved to 45.8%, and adjusted operating margin rose to 46.9%, up 180 basis points from the prior year. Year-to-date, Paychex generated $1.6 billion in operating cash flow and returned $1.2 billion to shareholders through dividends and stock buybacks.

The company also reaffirmed that it expects to close its acquisition of Paycor in April 2025. The deal is aimed at expanding Paychex’s upmarket reach and offering broader HR technology solutions to a combined customer base of nearly 800,000 businesses.