How does payments administration work?

Before a merger, the parties engage SRS Acquiom to serve as escrow and payments administrator and the escrow bank of their choosing to serve as a depository and independent escrow agent through a single engagement process and agreement – all seamlessly coordinated by SRS Acquiom. At closing, buyers simply wire the merger consideration to accounts at the escrow bank that are then disbursed or held in escrow in accordance with the terms in the merger agreement. The merger parties provide closing instructions via a flow of funds spreadsheet. SRS Acquiom administers all shareholder and third-party payments while the escrow bank securely holds, invests and releases escrow funds pursuant to the terms of the agreement.

SRS Acquiom’s services include managing the letter of transmittal collection process, electronic distribution of proceeds, payments of closing transaction expenses to third parties, tax reporting, lost shareholder investigation, and (if some shareholders are never found) escheatment compliance services. Simplified processes and experienced M&A professionals save merger parties significant time, expense and hassle, and the top-tier banks we work with ensure the neutrality needed from an escrow bank for releasing funds. Distributions to shareholders or third parties are made only upon written instruction from the merger parties, and, with respect to releases of escrow funds, only after the escrow bank has determined that it is proper to do so.

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Posted in: Services: Acquiom Clearinghouse