Evertec, a payment processing and switching solutions provider in Puerto Rico, has received approval from US federal bank to acquire EFT Group, a Chile-based firm commercially known as PayGroup, for approximately $40m.

Evertec said it will fund the transaction using a combination of cash on hand and funds borrowed under the existing revolving line of credit.

Payment processing and software company PayGroup primarily serves financial firms throughout Latin America.

Commenting on the deal, Evertec president and CEO Mac Schuessler said: “We are pleased to receive Federal approval for our transaction. This acquisition aligns well with our strategy to invest in the Latin American market and provides us with a foundation to expand upon in the future.”

Subject to customary closing conditions, the transaction is expected to close in the third quarter of 2017.