Intuit to buy online payroll co PayCycle for $170M

Intuit Inc. said Tuesday it has agreed to buy the online payroll service PayCycle Inc. for $170 million, part of the company's push to offer more of its financial services software over the Web.

Intuit said it would buy the privately held Palo Alto, Calif. company with cash.

The deal will help Intuit "offer small businesses a range of low-cost, high-value alternatives to expensive payroll outsourcers and time-consuming, error-prone manual payroll methods," Nora Denzel, a senior vice president at the company, said in a statement Tuesday.

Intuit says it expects to close the acquisition in the third quarter. The deal will reduce earnings per share by 2 cents in the fourth quarter, but isn't expected to have any material effect on earnings in 2010.

Intuit shares closed up 9 cents at $27.72.