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Finastra mulls sale of banking unit for $7b: Reports

By Gloria Methri

February 27, 2023

  • Avalara
  • D+H
  • Duck Creek Technologies
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Finastra, Vista, Universal banking, UK, FinTech, Misys, D+H, Avalara, Duck Creek TechnologiesFinastra, the global FinTech company owned by Vista Equity Partners, is looking to sell its banking unit for up to $7 billion, Reuters reported on Tuesday, citing sources.

The London-based company is separating the business and is expected to initiate the sale in the coming weeks, the report said. Called universal banking, the business unit provides software to banks and credit unions to run their core operations.

The business reportedly generates around $1.7 billion in revenue and approximately $500m in earnings before interest, tax, depreciation, and amortisation. Sources informed that Finastra has roped in financial advisers as it explores the sale of the business.

Rivals in the financial software industry as well as other private equity firms could be the potential buyers of the universal banking division, the report said.

The discussions are however at an early stage and there is no guarantee that a deal will materialise. Reuters sources also reported that Finastra and its owner have previously attempted the sale of other parts of its business. In 2021, the FinTech reportedly tried to sell its capital markets business, however, the deal did not come to fruition.

Both Finastra and Vista turned down requests for a comment on the matter.

Finastra was formed in 2017 following a merger between British FinTech Misys and Canadian payment technology provider D+H.

In recent years, Vista has been an active player in the financial technology industry. Last August, acquired tax automation platform Avalara in a deal valued at $8.4 billion. Earlier this year, it announced the acquisition of insurance-focused Duck Creek Technologies for $2.6 billion.

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