BELLEVUE, Calif. - Coinstar E-Payment Services Inc., a subsidiary of Coinstar Inc. July 25 announced plans to buy GroupEx Financial Corp., which provides money transfers between the United States and Latin America, the Puget Sound (Seattle) Business Journal reported. GroupEx employs 375 people and brought in about $62 million in revenue in 2006.
GroupEx operates a network with approximately 1,650 send agents in 23 states servicing 13 countries. After the closing, the Coinstar Money Transfer service will be offered at more than 31,000 agent locations in 143 countries.
The deal is estimated to be worth between $48 million and $58 million, with Coinstar paying $60 million upfront and receiving about $12 million on GroupEx's balance sheet. The exact amount of the deal, Coinstar said, won't be known until closing.
Aite Group research director, Gwenn Bézard, says the acquisition makes Coinstar a viable player in the money-transfer industry, threatening Western Union's and MoneyGram's positions at supermarkets where Coinstar already has a strong kiosk presence.
"With Travelex Money Transfer and now GroupEx's acquisition, Coinstar has been building volumes to become a credible alternative for supermarket chains - a space historically dominated by Western Union and MoneyGram," Bézard said. "The combination of Coinstar's network of kiosks and POS devices in retail locations, and the volumes of GroupEx, make Coinstar a serious competitor for the two leading money transmitters."
