Exult provides Web-enabled, integrated services designed to manage the entire HR function for large, global corporations; ADP National Account Services, part of Employer Services, is a leading provider of computing-based transaction processing and services for benefits, human resources and payroll administrative processes. The relationship is intended to enhance Exult’s capabilities to scale rapidly and provide best-in-class services to both domestic and international Global 500 companies. The agreement also provides ADP with an innovative way to extend its value proposition and best practice services to Exult clients.
Exult anticipates using ADP’s transactional and administrative services to supplement and enhance Exult’s service offering including payroll, benefits, and systems integration components. These ADP services include domestic and international payroll services including payroll, tax filing, print, wage garnishment, unemployment compensation, COBRA, and flexible-spending account services. Exult also anticipates using ADP’s Professional Services group, AG Consulting, to assist with systems integration work required to implement process management solutions for Exult’s growing roster of Global 500 clients. In addition, for selected client engagements, ADP anticipates jointly marketing with Exult to promote a combined comprehensive suite of services including HR, benefits, and payroll administrative and processing services, and finance and accounting management services, for large, multinational clients.
As part of the relationship, ADP will purchase an initial $20 million of Exult’s common stock at a price approximating average market value over the past 30 days. Exult and ADP have agreed that ADP will purchase an additional $30 million of Exult common stock in stages over the next few years presuming the volume of business derived from the relationship by ADP reaches expected levels.
We could not be more pleased to be collaborating with an established market leader in IT services for HR applications to address the needs of the Global 500 market, said Jim Madden, Exult’s chairman and CEO.
Exult’s comprehensive service delivery model is changing the way in which large, multinational companies approach the HR and finance and accounting functions. We do this by moving HR services to a self-service model via the Internet, standardizing and centralizing processes, and by partnering with best-of-breed providers such as ADP to leverage their scale and domain expertise.
After evaluating numerous market offerings, we chose ADP as a world-class provider to support service delivery to our Global 500 clients. This relationship should help Exult to continue our rapid growth as the market leader in the field of business process outsourcing (BPO) for HR.
This agreement enables ADP to further extend our compelling value proposition to the largest companies in the world, and it also expands our ability to serve the emerging market for total outsourcing of HR administration, said Russ Fradin, president, ADP Employer Services — North America. ADP can integrate its services seamlessly with Exult to produce a better result for Exult’s clients. We look forward to working with Exult to help selected Global 500 client companies control HR costs, improve internal service delivery and better manage their employee relationships for their own competitive advantage.
Mr. Madden indicated that Exult intends to integrate ADP processing services with Exult’s delivery mechanism over the next six months to nine months.
It is anticipated that as part of the agreement Josh Weston, ADP’s former Board Chairman and CEO, will be appointed to the board of directors of Exult.
