By Sabela Ojea

Payroll-services company Paychex is acquiring rival Paycor HCM in a deal with an enterprise value of about $4.1 billion.

Paychex on Tuesday said the board of directors of both parties approved the transaction in an agreement that prices each Paycor share at $22.50.

The takeover price represents a premium of approximately 19% over Paycor's 30-day, volume-weighted average trading price as of Jan. 3.

Shares of Paychex rose 2.2% to $139 in premarket trading, while Paycor traded around 3.5% lower to $22.06. Paycor's stock surged 23% on Monday after Bloomberg reported the companies were in advanced talks.

Paycor, which serves over 49,000 clients, and supports about 2.7 million employees across the U.S., has invested in data and artificial intelligence since going public in 2021, Paychex said.

"The acquisition of Paycor is highly complementary," Chief Executive John Gibson said. "It will enhance our capabilities upmarket, broaden our suite of AI-driven HR technology capabilities, and provide new channels for sustained long-term growth."

The acquisition is expected to close in the first half of 2025, subject to regulatory approvals.

Write to Sabela Ojea at sabela.ojea@wsj.com; @sabelaojeaguix

(END) Dow Jones Newswires

January 07, 2025 09:19 ET (14:19 GMT)

Copyright (c) 2025 Dow Jones & Company, Inc.