Thomson Reuters Corp. announced plans to buy SurePrep LLC, a business that creates tools that accounting firms use to help clients with their taxes.
SurePrep's value as of the transaction is $500 million. Thomson Reuters intends to pay cash for the acquisition and anticipates a tax gain of around $60 million as part of the deal. According to the firms, the acquisition is expected to be finalised in the first quarter of 2023.
Thomson Reuters, the parent company of Reuters, is based in Toronto. Additionally, it offers software solutions that make it easier for tax and legal professionals to complete daily tasks. According to Thomson Reuters, 85% of the businesses on the Fortune 500 list use its legal software, while 99% use its tax preparation tools.
SurePrep uses artificial intelligence and a consumer-grade mobile-friendly design to automate the acquisition of digital documents directly from clients and the processing of those documents. This increases efficiency for CPAs by automatically extracting and populating key data into the company's tax compliance software. The main programmes and services offered by SurePrep are 1040SCAN, SPbinder, and TaxCaddy.
SurePrep, a cloud-based platform, is one of the company's products that accounting firms can utilise to gather client tax-related documentation. The portal also provides several additional functions, including the opportunity to pay taxes.
Accounting businesses may handle customer tax paperwork more easily due to 1040SCAN. The software automatically groups supplied documents into folders to save users' time. Additionally, data is extracted from the documents using Machine Learning and loaded into tax software by an accounting firm.
The final item from SurePrep is a tool for productivity called SPbinder. SurePrep has laid a target to produce nearly $60 million in revenue this year, according to Thomson Reuters, “Allowing tax professionals to attach notes to the files they're processing and underline key passages. SurePrep's revenue growth is guaranteed to occur at a 20% yearly pace for the upcoming few years.”
In the first year following completion, Thomson Reuters anticipates that the transaction won't have a material impact on its adjusted EBITDA or earnings before interest, depreciation, and amortisation. Following that, SurePrep should deliver "annual gains" in adjusted EBITDA.
Beginning in April 2022, Thomson Reuters and SurePrep have collaborated to offer complementary products for the benefit of tax and accounting professionals. Following the acquisition of SurePrep, Thomson Reuters will keep pursuing its open ecosystem approach, and the combined company will serve as a stronger base for faster investment in automation and customer experiences.
About Thomson Reuters
Thomson Reuters, an international media and information company, provides essential information from the media, legal, risk, accounting, intellectual property, and financial sectors. The business primarily offers subscription-based electronic content and services to professionals. In addition to providing news, information, and analytics, its finance and risk section also facilitates transactions that connect communities for trading, investing, financial, and corporate professionals. Additionally, this category offers operational and regulatory risk management solutions.
Thomson Reuters also runs Reuters, which offers newspapers, television and cable networks, radio stations, and websites real-time multimedia news and information services.
SurePrep, a company established in 2002, is dedicated to assisting accounting businesses in boosting productivity and profitability while advancing a digital tax workflow. SurePrep, situated in Irvine, California, has a significant customer base. According to the business, over 23,000 professionals use its tax preparation software to support their daily tasks at accounting firms and other businesses. The acquisition is expected to close in the first quarter of 2023, subject to the required regulatory approvals and usual closing conditions.