Forager Capital issues second letter to REPAY shareholders

Forager Capital Management, which holds approximately 13% of Repay Holdings Corporation (NASDAQ: RPAY), issued a second open letter to shareholders criticizing the company's board for rejecting a $4.80 per share all-cash acquisition proposal.

The investment firm stated that Repay's board rejected the offer, which represented a 75% premium, as "significantly undervaluing" the company without providing a detailed explanation for the decision. Forager argued the board failed to articulate why remaining independent would create superior value for shareholders.

Forager highlighted concerns about Repay's 2021 acquisition of BillingTree, which was purchased for approximately $503 million. The firm stated that shareholders who invested $1.00 in Repay stock on the day the BillingTree acquisition was announced in May 2021 would have approximately $0.17 remaining today.

According to the letter, BillingTree was expected to contribute $60 million in revenue and $26 million in adjusted EBITDA, with promised synergies of $5 million by 2022. However, Forager noted that despite additional acquisitions, Repay reported only $309.3 million in revenue and $128.6 million in adjusted EBITDA in 2025, representing 6% revenue growth and 5% adjusted EBITDA growth annually from 2021 through 2025.

In 2025, Repay recorded a $241.7 million goodwill impairment related to Consumer Payments, which Forager cited as evidence that the BillingTree acquisition assumptions were not supportable.

Forager drew parallels between the BillingTree acquisition and Repay's pending KUBRA acquisition, noting similar narratives around strategic technology, synergies, and leverage. The firm stated it remains committed to its $4.80 per share proposal and urged shareholders to communicate directly with the board.

The information is based on Forager Capital Management's press release statement.

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