Finastra reportedly looking to sell banking business
Finastra, an international banking, financial and payments technology heavyweight, is looking to offload its banking unit, according to Reuters.
Finastra ponders the sale of its banking business
The London-headquartered company, which has grown over the years via mergers and acquisitions – picking up the likes of banking tech veteran Misys; Thomson Reuters’ treasury capital and risk management software business; Canadian payments and lending tech provider D+H; and US-based digital banking vendor Malauzai, among others – has been known as Finastra since 2017.
According to Reuters, Vista Equity Partners, which has owned Finastra and its key component predecessors for over a decade, is exploring the sale of its banking portfolio for as much as $7 billion.
It is carving out the “universal banking” business that will house core and digital banking solutions for banks and credit unions, which it believes can appeal to other venture capital and private equity firms as well as technology companies.
The business currently generates $1.7 billion in revenue and around $500 million of earnings before EBIDTA, sources tell Reuters.
In the banking and credit union space, among Finastra’s products are:
- Phoenix core banking system, which stems from Harland Financial Solutions, a long-standing core offering for small and mid-tier banks and credit unions in the US (Harland was acquired by D+H a decade ago).
- Essence core banking system and its much older siblings, Equation and Midas (plus the now sunsetted Bankmaster core system), which stem from Misys – offered to banks worldwide.
- Malauzai’s digital channels solutions for US community financial institutions (the Texas-based vendor was acquired by Finastra in 2018; its founder and CTO left two years later).
Will be interested in seeing what buyer wants to pay that much for such older technology.