The e-commerce transaction processor is selling its recovery management software (RMS) business to Europe's London Bridge Software, a provider of software and consulting for credit risk management.
"We weren't looking to sell the business, but this is a strategic buyer, and we owe it to our shareholders," said Matt Lewis, a CheckFree spokesman.
London Bridge will pay $33.45 million in cash at the closing and as much as $1.5 million more if it reaches certain license sales targets for RMS products through June 30, 1998. The deal is expected to close August 30.
All CheckFree's RMS operations, including the 30 employees who are currently part of the RMS business unit, will be offered positions with London Bridge's U.S. operations. London Bridge is based in Charlotte, North Carolina, but will keep the RMS division in Atlanta.
CheckFree has other software business that do not mesh with the company's newfound focus. It has no current plans to sell off those units, which Lewis described as "good businesses with good margins."
Since October CheckFree's stock has fallen from a 52-week high of 25 a share to 17-5/8 at the market's close yesterday.
RMS streamlines and automates the entire debt collection and recovery process. It manages and directs the recovery process of bad-debt accounts, emphasizing internal collections, legal, bankruptcy, collection agency placement, collateral tracking, accounting, administrative, and management reporting.
Last October, CheckFree sold its securities certificate accounting software business to Sungard SSI, a subsidiary of SunGard Data Systems, for $20 million.