Exclusive-Online payroll vendor TriNet explores sale -sources

By Milana Vinn

(Reuters) -TriNet Group, an online payroll services provider with a market value of close to $7 billion, is exploring a potential sale of the company, according to people familiar with the matter.

The Dublin, California-based company is working with investment bank Morgan Stanley to engage with potential acquirers, the sources said.

No deal is certain, the sources added, requesting anonymity because the matter is confidential.

TriNet and Morgan Stanley declined to comment.

TriNet shares rose 15% on the news to $111.85 in afternoon trading in New York on Friday.

Founded in 1988, TriNet provides a wide range of human resources services to small and medium-sized businesses, including payroll, compliance and tax credit services. It has nearly 23,000 clients, processing over $70 billion in payroll annually.

Private equity firm Atairos, which was founded by former Comcast executive Michael Angelakis, owned 36% of TriNet as of the end of March. It acquired most of its stake from General Atlantic in 2017.

TriNet shares are up 44% so far this year, significantly outperforming an 11% return in the Russell 1000 index, as its business benefited from companies continuing to hire despite a spike in inflation.

Concerns over a potential economic slowdown, however, fueled by the Federal Reserve raising interest rates, are clouding TriNet's financial outlook.

The company itself has remained bullish, arguing that many of the technology startups it caters to are continuing to grow. In April, TriNet raised its net-income-per-diluted-share forecast for 2023 by $0.74 at the midpoint to a new range of $3.96 to $4.90.

(Reporting by Milana Vinn in New YorkEditing by Marguerita Choy, Kirsten Donovan)

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