Performant Financial Corp. agreed to acquire Premiere Credit of North America LLC, an ECMC Group Inc. affiliate that provides recovery services to government, student loan and commercial clients.
In exchange, Performant will issue one million common shares at the closing of the deal, targeted this September. Performant will issue additional common shares based on revenues associated with Premiere Credit over the next five years.
Also at deal closing, Performant and ECMS will enter into a long-term agreement in which Performant will become the latter's primary student loan recovery vendor. Performant will also amend its existing credit agreement with ECMC, including a one-year extension of the maturity date to August 2021 and a $10 million increase in Performant's additional borrowing capacity under the facility.
In line with the acquisition, Performant narrowed its full-year revenue and adjusted EBITDA guidance. Revenues are now expected to be between $130.0 million and $150.0 million from $123 million and $150 million, while adjusted EBITDA are expected to range from $2.0 million to $3.0 million from $2 million to $6 million.
The company recorded a second-quarter net loss of $3.6 million, or 7 cents per share, compared to net loss of $2.4 million, or 5 cents per share, in the prior year period.
Adjusted EBITDA for the second quarter was $119,000, down year over year from $5.0 million. Revenues also decreased in the recent quarter to $31.3 million from $35.9 million.