Deel goes on the M&A offensive

Deel, an international hiring startup, offered to acquire PayGroup, a payroll company focused on the Asia Pacific region, for about A$119.3 million ($83.3 million).

Why it matters: Deel has never shied away from acquisitions, but with lower valuations in many parts of startup land and reportedly some new funding for Deel, the company is dialing up that part of its business.

Deel is about to become "pretty aggressive in M&A because there are great founders and businesses out there," CEO Alex Bouaziz told Axios while at the Collision conference.

• "There's going to be a lot of consolidation and a lot of companies going out of business in our space," he added.

Details: Deel is unlikely to buy a multibillion company but could target smaller businesses that don't directly compete while allowing Deel to expand in new directions.

• The PayGroup (ASX:PGY) acquisition helps Deel expand in Australia, India, Singapore and Japan.
• This will mark the company's third acquisition, if completed.
• Beyond payroll, Bouaziz says, Deel would be interested in acquisitions that could boost its financial services capabilities. (Deel has a card product allowing the folks it places at companies to spend directly from their Deel balance.)
• Other M&A targets could improve its HR automation tech.

Of note: The price tag would represent the highest PayGroup has ever fetched since going public in 2018.

One fun thing: Deel CFO Philippe Bouaziz is CEO Alex Bouaziz's father. He completed over 50 acquisitions during his time at Prodware, a French company he founded. That DNA appears to have passed down at Deel.