Fidessa Group Plc said on Wednesday that it has agreed to a takeover by Swiss fintech company Temenos in a deal worth up to £1.4 billion ($1.96 billion), signaling the start of what may become a flurry of consolidation in the sector.
It comes after the pair said yesterday that they were in detailed, advanced discussions over an all-cash acquisition offer.
The UK-based trading technology supplier recommended the deal to shareholders, who will receive £35.67 per share, plus the £0.797 per share dividend announced before the company’s 2017 results.
The takeover will allow Temenos Group AG to achieve its turnaround ambitions sooner than expected through tapping Fidessa’s equity-trading technology.
Temenos’s pursuit of Fidessa is its second attempt to buy a British software company. The deal comes six years after losing out in the battle to buy UK financial software provider Misys.
Temenos’s executive chairman Andreas said that the deal will accelerate both companies’ complementary growth strategies against a background of increasing economic uncertainty in the UK and a more challenging trading environment. It also enables his company to cross-sell into existing client bases and capture a greater share of the IT and software spend of banks especially as they move to the cloud.
He added in a statement: “The capital markets industry is undergoing structural changes that will require it to renew its software systems. However, the current vendor landscape is fragmented and dominated by legacy technology. This creates a huge opportunity to combine the complementary product strengths of Fidessa and Temenos in the front and back office to create a highly differentiated multi-asset class end-to-end platform for capital markets that will offer best in class costs and processing capabilities.”