Sources: Gusto paid $600M to acquire Guideline, plans to divest customers linked to rivals
Gusto, a human resources technology company, has acquired Guideline, a 401(k) retirement plan provider, for an estimated $600 million. The deal comes as Gusto aims to streamline its offerings and focus on its core HR services. Guideline, which was last valued at $1.15 billion, will likely generate a profit for most of its investors through this acquisition. The move is part of Gusto's strategy to divest customers who are linked to its competitors, as it seeks to consolidate its market position and enhance its product portfolio. The acquisition is expected to strengthen Gusto's position in the HR tech space, allowing it to provide a more comprehensive suite of services to its clients. However, the company's plans to divest customers associated with rival companies suggest a strategic shift towards a more focused and competitive approach in the industry.
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