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Warburg Pincus announces Avaloq deal

Private equity firm, Warburg Pincus, is to pay close to SFr300 million for a 35% stake in Swiss core banking venture, Avaloq. The transaction, touted as the first step towards a potential public listing, values the company in excess of Sfr1 billion.

Avaloq has more than 2,000 employees and serves 155 banks and wealth managers in the likes of London, Frankfurt and Paris. It generated revenues of SFr533 million in 2016, a 10% increase from a year earlier. As part of the transaction, Founder and CEO Francisco Fernandez will also assume the role of Chairman. Jürg Hunziker will take on the role of Deputy CEO and Group Chief Markets Officer.

The company is also creating a European Advisory Board to support strategic initiatives and growth. This will include Jacques Aigrain, former CEO at Swiss Re and Chairman, LCH.Clearnet, Stefano Boccadoro, the former General Manager at Cassa Lombarda Bank and CEO, Santander Italy, Stefan Krause, former Chief Financial Officer, Deutsche Bank and BMW and Javier Marin, former CEO, Santander.

Fernandez comments: “Warburg Pincus’ global presence, in the US, Europe and years of experience in Asia, combined with their extensive experience in financial services and software, and large network in the broader banking and wealth management industry will be invaluable as we enter a new stage in the development of Avaloq and its geographic expansion. While our management, employees and current Board of Directors retain the majority by means of shares and governance, we will leverage Warburg Pincus’ expertise to continue our path for capital market readiness.”

Daniel Zilberman, a Managing Director and Head of Europe at Warburg Pincus, says: “With its focus on innovation, we believe that Avaloq is uniquely qualified to take advantage of growing demand for cutting edge software and outsourced services in the financial industry. We look forward to partnering with Francisco, Jürg and the rest of Avaloq’s talented team as the company enters a new and exciting stage in its international growth path.”

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