Toronto small business software firm Wave taken over by H&R Block

Tax company H&R Block has struck a $537-million deal to acquire Toronto-based accounting software firm Wave Financial.

Wave provides accounting, invoicing, payroll and payments software on its platform used by more than 400,000 small businesses each month.

It started out offering free, cloud-based accounting and invoicing for small businesses, but has since introduced fees at various stages in its software. It now has about 400,000 customers globally.

H&R Block says the acquisition expands the its product and client portfolio and enhances its position in the small business sector.

Under the terms of the agreement, it will acquire all outstanding shares of Wave for $405 million US or roughly $537 million Cdn in cash.

The Kansas City-based company says the transaction is expected to close within the next few months, subject to regulatory approval.

After the deal is complete, Wave will maintain its leadership team and will operate independently within H&R Block from its headquarters in Toronto.