Yesterday, Bottomline Technologies announced that it agreed to purchase Andera, a provider of customer acquisition solutions for banks and credit unions. The company has over 500 customers and has helped process more than 4.5 million new account applications.

More specifically this offering will pair with the recent Intuit acquisition and will focus on providing commercial banking customers with a strong customer acquisition application. Andera’s oFlows solution is licensed solely as a subscription and transaction model. We are relatively pleased with this acquisition, given that it bolsters Bottomline’s commercial banking platform and drives additional subscription and transaction revenue.

The transaction is valued at about $44.5 million in cash and 102,000 shares of Bottomline stock, which would equate to roughly $48 million. The revenue contribution from the transaction is expected to be $2 million in the fiscal fourth quarter of 2014 and $10 million in fiscal 2015. On a forward revenue basis, the company was purchased for roughly 4.8 times, slightly ahead of the software-as-a-service group median of 3.6 times. From a core income perspective, the transaction is expected to be $0.02 dilutive in fiscal fourth quarter 2014, breakeven in the first quarter of fiscal 2015, and accretive by $0.02 in fiscal 2015.

We view Bottomline as a hybrid vendor that sells both software and services (SaaS); thus it is difficult to compare the company against a set of peers, as most companies provide either the software or the transaction services. We compare Bottomline against a blended group of other software, slow-growth SaaS, and payment processing companies, MasterCard.