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DUBLIN, Calif. and COLUMBUS, Ohio - TriNet (NYSE: TNET), a key player in HR solutions for small and medium-size businesses with annual revenue of $4.99 billion, has finalized the sale of its subsidiary, TriNet Clarus R+D, to Arvo Tech, a company specializing in tax strategy solutions for small businesses. According to InvestingPro data, TriNet currently maintains a market capitalization of $3.71 billion and operates with a moderate debt level. The transaction, completed today, transfers TriNet Clarus R+D’s tax team, service model, and proprietary software to Arvo Tech, though financial terms were not disclosed.
This divestiture aligns with TriNet’s strategy to focus on delivering high-value HR solutions to the SMB market, where the company has maintained a healthy gross profit margin of 17.8%. By joining forces with Arvo Tech, the Clarus business is expected to expand within an organization that is dedicated to tax solutions and managing a tax credit portfolio. InvestingPro analysis reveals several additional insights about TriNet’s financial health and market position, available in the comprehensive Pro Research Report.
Arvo Tech aims to enhance its market standing as a provider of tax credit programs for SMBs, leveraging technology to broaden taxpayer access. "Acquiring TriNet Clarus R+D accelerates our mission of providing tax strategy solutions for SMBs," stated Terracina Maxwell, President and Co-Founder of Arvo Tech.
Jay Venkat, TriNet’s Executive Vice President of Strategy, Products, and Transformation, expressed confidence in the future success of the Clarus team under Arvo Tech’s umbrella, highlighting the continued commitment to delivering exceptional tax solutions to SMBs.
To ensure a smooth transition, TriNet customers will maintain access to R&D tax credit solutions through a five-year agreement with Arvo Tech.
TriNet provides SMBs with comprehensive HR solutions, including professional employer organization services and human resources information systems, backed by over 30 years of experience. Arvo Tech offers a holistic approach to tax strategy and credit management, designed to streamline tax processes and maximize financial outcomes for small businesses.
The information in this article is based on a press release statement.
In other recent news, TriNet Group reported a strong performance in its fourth-quarter 2024 earnings, surpassing expectations with an earnings per share (EPS) of $0.44 compared to the forecasted $0.25. The company’s revenue also exceeded projections, reaching $1.3 billion against the anticipated $1.25 billion. Despite these positive results, the stock experienced a decline, attributed to strategic changes and potential challenges in the upcoming year. TriNet is exiting its HRIS software-only business to focus on HR Plus ASO products, marking 2025 as a transitional year for the company.
In terms of analyst ratings, Stifel has maintained a Buy rating on TriNet, keeping a price target of $97.00, expressing confidence in the company’s ability to address its current challenges. Conversely, TD Cowen downgraded TriNet from a Buy to a Hold, lowering the price target from $104.00 to $74.00, citing a lack of immediate catalysts for stock performance. Analysts from both firms have noted the company’s strategic shift and the potential for future growth under the new CEO’s initiatives. TriNet’s strategic transition and market reactions are being closely monitored by investors and analysts alike.
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