Heartland to buy ADS' network services business for $77.5M

NEW YORK—Heartland Payment Systems reached a deal to buy Alliance Data Systems Corp.'s network services business for $77.5 million to gain a foothold in the business of processing transactions for energy companies, the payment processor said Monday.

Alliance Data's network services unit was one of the 20 biggest payment processors last year, processing $17 billion in bank card charges through 604 million transactions, the company said citing a Nilson report.

Heartland, which is based in Princeton, N.J., processed $51.9 billion in payments last year.

The companies expect to complete the sale in the next 30 days. Heartland, which is financing the deal through existing cash and money borrowed under credit lines, expects the acquired business to begin contributing profit next year.

Heartland's chief executive, Bob Carr, said in a statement the company wants to offer its own technology to the network services segment's customers, and also achieve more efficient spending by expanding its business.

Carr said Heartland was attracted to the unit's substantial customer base of energy customers because the energy industry grows steadily and stably in different types of economic cycles.

SunTrust Robinson Humphrey was financial adviser to Heartland Payment Systems, and Womble Carlyle Sandridge & Rice was legal adviser.