Finastra is exploring the potential sale of its Middle Eastern and Asian core banking unit, a deal that could be valued at over $1 billion, according to a report from Reuters. The London-based financial software company, which is owned by private equity firm Vista Equity Partners, is working with advisers from Arma Partners on a sale process expected to launch later this year.
The unit provides essential software for banks and credit unions to manage their core operations and is projected to generate approximately $100 million in EBITDA for the current year. Potential buyers are anticipated to include other private equity firms and competitors within the financial technology sector. Sources caution that the discussions are preliminary and a transaction is not assured.
This potential divestiture follows a broader trend of consolidation in financial services technology. According to data from the IndexBox platform, the global market for financial software and services has seen increased M&A activity, contributing to a total deal value that reached a multi-year high. Finastra itself recently sold its Treasury and Capital Markets division to Apax Partners in May.
Finastra was formed in 2017 when Vista merged Misys with DH Corp. The company has also recently entered into a strategic collaboration to facilitate faster cross-border payments for banks using stablecoin technology.
Source: indexbox.io
