Webster Signs Definitive Agreement to Acquire Ametros

Webster Financial Corporation, a leading commercial bank, has announced its plans to acquire Ametros Financial Corp, the nation's largest professional administrator of medical insurance claim settlements. This strategic acquisition will provide Webster with a fast-growing source of low-cost and long-duration deposits, new sources of noninterest income, and enhanced expertise in healthcare financial services.

Ametros is known for its CareGuard service and proprietary technology platform, which help individuals manage their ongoing medical care and navigate the complex US healthcare system. With over 24,000 members and $804 million in deposits under custody, Ametros brings a unique value proposition to Webster. The average deposit balance per account is $33,000, and deposits are projected to grow at a five-year CAGR of approximately 25%.

The acquisition of Ametros aligns with Webster's strategic focus on building a diverse and unique funding base. John Ciulla, President and CEO of Webster Financial Corporation, stated, "Ametros' market position and value proposition for its clients and partners underpin a robust growth trajectory for this highly complementary business."

Porter Leslie, CEO of Ametros, also expressed enthusiasm for the partnership with Webster, calling them the perfect growth partner for their unique business. The acquisition is expected to close in the first quarter of 2024, subject to customary closing conditions and anti-trust review.

Webster will acquire Ametros for $350 million in cash, with the transaction expected to be over 2% accretive to FY25 consensus estimates. It is projected to generate an IRR over 25% and has a five-year earn-back of tangible book value dilution. Upon the close of the transaction, Ametros will operate as a subsidiary of Webster.

Webster Financial Corporation, with its principal bank subsidiary Webster Bank, N.A., is a values-driven organization with over $70 billion in assets. It provides a wide range of digital and traditional financial solutions across three differentiated lines of business: Commercial Banking, Consumer Banking, and its HSA Bank division, a leading provider of employee benefits solutions.

Ametros, headquartered in Massachusetts, is the industry leader in post-settlement medical administration. It is a trusted partner for thousands of members receiving funds from workers' compensation and liability settlements. Through its CareGuard service and proprietary technology platform, Ametros helps individuals manage their ongoing medical care, provides settlement advisory support, and ensures compliance with government reporting.

This strategic acquisition positions Webster as a leader in the healthcare financial services sector. With Ametros' expertise and market reach, Webster will be able to offer innovative solutions to its customers while benefiting from the growth opportunities in the medical insurance claim settlements market.

The acquisition of Ametros will not only provide a source of low-cost and long-duration deposits but also diversify Webster's funding base. This will strengthen the bank's financial profile and contribute to its overall growth trajectory. Additionally, the transaction will enhance Webster's noninterest income and expand its portfolio of financial services.

Webster's history of developing non-traditional deposit verticals, such as HSA Bank and interLINK, demonstrates its commitment to innovation and finding new sources of revenue. The acquisition of Ametros aligns with this strategy, bringing together two organizations that are focused on providing exceptional financial services and value-added solutions to their customers.

By combining Webster's resources and industry expertise with Ametros' market leadership and unique value proposition, the acquisition has the potential to create significant synergies and drive future growth. Together, Webster and Ametros will be well-positioned to meet the evolving needs of their customers in the healthcare industry and provide them with comprehensive financial solutions.

As the healthcare landscape continues to evolve, the demand for efficient and effective financial services will only increase. Webster's acquisition of Ametros positions the bank to be a leader in this space by offering innovative solutions that help individuals manage their medical care and navigate the complex US healthcare system.

In conclusion, Webster's definitive agreement to acquire Ametros demonstrates the bank's commitment to strategic growth and diversification. This acquisition will not only provide a new source of deposits and noninterest income but also enhance Webster's expertise in healthcare financial services. With this partnership, Webster is well-positioned to capitalize on the growing demand for innovative solutions in the healthcare industry and continue to deliver exceptional value to its customers.