First Advantage Completes Sterling Check Acquisition for $2.2 Billion

Deal News | Oct 31, 2024 | Globenewswire

First Advantage Completes Sterling Check Acquisition for $2.2 Billion

First Advantage Corporation has completed its $2.2 billion acquisition of Sterling Check Corp, which includes the assumption of Sterling's outstanding debt. This transaction is set to advance First Advantage's offerings in employment background screening, identity, and verification solutions by enhancing its product suite and technological capabilities. The acquisition is projected to deliver synergies ranging from $50 million to $70 million and result in double-digit EPS accretion on a run-rate synergy basis. This merger will additionally diversify First Advantage's revenue streams across sectors such as healthcare, retail, transportation, and others, improving resilience and operational efficiency. With this acquisition, First Advantage plans to foster innovation, particularly in AI-driven automation, facilitating a seamless integration of the two companies' cultures. Notable advisors involved in the transaction include J.P. Morgan Securities LLC and Goldman Sachs & Co. LLC, among others.

Sectors

  • Employment Background Screening
  • Technology Solutions

Geography

  • United States – First Advantage is headquartered in Atlanta, Georgia, and has completed the acquisition of a U.S.-based company, Sterling Check Corp.
  • Global – First Advantage performs screens in over 200 countries and territories, indicating the global reach and impact of the acquisition.

Industry

  • Employment Background Screening – The acquisition enhances First Advantage's capabilities in employment background screening, an industry focused on providing background checks and verification services for hiring purposes.
  • Technology Solutions – Both companies offer technology-driven solutions, with a focus on innovation, including AI and digital identification technologies as a part of their service offerings.

Financials

  • $2.2 billion – Total value of the acquisition, including the assumption of Sterling's outstanding debt.
  • $50 million to $70 million – Expected run-rate synergies delivered by the transaction.
  • $1.5 billion – Pro forma combined revenue of First Advantage and Sterling post-acquisition.

Participants

NameRoleTypeDescription
First Advantage CorporationAcquirerCompanyA leading global provider of employment background screening, identity, and verification solutions, headquartered in Atlanta, Georgia.
Sterling Check Corp.Target CompanyCompanyA company providing background screening and verification services that has been acquired by First Advantage.
J.P. Morgan Securities LLCLead Financial Advisor to First AdvantageCompanyActed as the main financial advisor to First Advantage for the acquisition.
Goldman Sachs & Co. LLCFinancial Advisor to SterlingCompanyProvided financial advisory services to Sterling during the acquisition process.
Simpson Thacher & Bartlett LLPLegal Advisor to First AdvantageCompanyServed as legal counsel to First Advantage in the transaction.
Fried, Frank, Harris, Shriver & Jacobson LLPLegal Advisor to SterlingCompanyServed as legal counsel to Sterling in the transaction.