FinTech activity continued in December. US consumer transaction technology business NCR Corporation acquired payment processing and fraud prevention specialist Alaric Systems from NVM Private Equity for $84m, Aegon acquired Novia’s platform development arm Novia Investment Services, Edmund Truell invested alongside insurance sector investor Londongate Investment & Management, to acquire a signficant minority stake in insurance technology business Regulatory Efficiency Gains, the independent broker network Brokerbility invested in insurance software business BrokerTech, financial adviser compliance and business support firm SimplyBiz acquired employee benefits software provider Staffcare, cloud-based technology focused venture capital investor Notion Capital invested $0.5m (alongside other VC investors) in Irish fraud prevention business Trustev and moneysupermarket.com founder Simon Nixon invested $3m in ComparaOnline, the Chilean insurance and financial services online marketplace.
Deals in the payments sector remained active with Business Growth Fund-backed ATM services business Cennox acquiring US ATM business Sterling Group, AIM-listed eServGlobal taking a 35% share (and A$9m) in the mobile cross-border remittance business HomeSend with MasterCard taking a controlling stake. New Zealand direct debit payment systems provider Debitsuccess acquired direct debit collections services provider Debit Finance Collections, Wayra-backed mobile payments business Ensygnia acquired data solutions provider Mustard Digital and mobile banking and payments specialist Vipera acquired Italian contract programmer supplier Advance Codd & Date.
Corporate services was also active with Anacap-backed trust and corporate services provider First Names Group acquiring Luxembourg corporate services provider Citadel Services and Sovereign Capital-backed compliance consulting specialist Cordium acquiring the compliance and accounting firm Sigma Partnership.
An active month for private equity investments into the financial support services sector with BC Partners agreeing to acquire financial news provider The Mergermarket Group from educational materials and services provider Pearson for £382m, and Advent International / Bain Capital acquiring the remaining 19.99% stake held by RBS Group in global payments business WorldPay.
Private equity’s interest in international payments / foreign exchange also continued with World First securing a significant minority growth equity investment from a syndicate led by FTV Capital, RBS Special Opportunities Fund-backed Moneycorp acquiring corporate foreign exchange service provider Thomas Cook CFX Ltd for £4.5m, Mercia Fund Management backing payment services provider Kwanji and Metric Capital Partners providing growth investment capital for payment services provider Secure Trading.
Fund administration was also active with US Bancorp Fund Services acquiring Ireland-based hedge fund administrator Quintillion and CBPE Capital-backed JTC Group acquiring the Guernsey-based fund administration business of Anson Fund Managers. Elsewhere, energy trading solutions provider Trayport acquired the energy trading risk management services provider Contigo, Calculus Capital invested £2.7m in online personal finance business One Place Capital, The Jenson Seed EIS Fund invested in the digital analyst estimate platform ACE Consensus and online venture investing platform JustInvesting attracted £0.75m seed funding from selected high net worth investors including Robin Klein (Index Ventures).
FinTech continues to be active with Deutsche Börse announcing the purchase of a minority stake in multi-asset trading provider Global Markets Exchange Group International (GMEX). Mobile banking and payments provider Monitise agreed to acquire the remaining 50% stake it does not already own in Monitise Asia Pacific Ltd, the Hong Kong mobile banking, payments and commerce networks provider from its joint venture partner, First Eastern Mobile Investments Ltd for £11.25m. Also online information and events group Euromoney Institutional Investor acquired international infrastructure markets information provider Infrastructure Journal for £12.5m and HSBC Global Market’s equity and bond indices business Quantitative Techniques.
The online lending sector has also been active with short-term loans provider WDFC UK (formerly Wonga.com) acquiring Germany-based on-line payment service provider BillPay whilst online business finance marketplace Funding Circle raised $37m from Accel Partners and Ribbit Capital, as well as existing investors Index Ventures/Union Square Ventures, and announced the acquisition of the US business loan provider Endurance Lending Network.
Edmund Truell’s London-listed financial services acquisition vehicle Tungsten Corporation announced the acquisition of global business to business e-invoicing operation OB10 from private equity fund Fleming Family & Partners for £99m, whilst telematics provider Trakm8 Holdings acquired telematics and fleet management services provider BOX Telematics in a reverse takeover. Business services outsourcing provider Equiniti Group has purchased Killik Employee Services, the discretionary share plan administrator arm of Killik & Co, and the merchant banking and operational risk management business Salamanca Group acquired the Investec Trust group of companies from Investec Bank.
Private equity and venture capital funds have also been active elsewhere with Ulster Bank Diageo Venture Fund/Investec Ventures investing €4m in Ireland-based financial institutions enterprise platform solutions provider Fenergo and HgCapital-backed accounting software provider Iris Software acquiring accountants software services provider Kashflow Software. Finally Baird Capital acquired financial services consulting firm Alpha Financial Markets Consulting for £28m.
Private equity investors remain active in the sector with Lloyds Development Capital announcing the acquisition of Isle of Man-based trust and corporate service specialist Equiom from private equity firm ISIS Equity Partners. Venture capital firm Accel Partners led an $18m investment, alongside existing venture capital investor Octopus Investments, in mutual fund industry cross-border transaction network Calastone while technology-based venture capital fund investor Verso Capital acquired the assets of mortgage sourcing software business CDS Group.
Business process outsourcing firm Xchanging acquired Market Maker 4, a US-based e-sourcing technology business for up to $22m, subject to certain performance criteria, while Tungsten, run by former Duke Street founder Edmund Truell announced its intention to float on the London stock exchange and acquire electronic invoice processing business OB10, whose shareholders include private equity firm Fleming Family & Partners.
Fintech was also active with wealth management software provider Third Financial Software announcing the acquistion of the ActiveBank business, formerly part of Financial Objects which was acquired by Temenos in 2008. Credit referencing and information provider Experian announced the acquistion of US-based fraud detection software business The 41st Parameter Inc for $324m, specialist insurance service provider Charles Taylor acquired the business and assets of business solution provider KnowledgeCenter for £1.9m, while payment processor WorldPay Group announced the acquistion of US-based merchant payment processor Century Payments.
Strong US interest in the UK financial support services sectors continues with US ATM services provider Cardtronics announcing the acquisition of UK (and Germany) ATM services provider Cardpoint Limited (Cashzone) from Payzone Ventures for £107.5m. US based payment, invoicing and document solutions provider Bottomline Technologies has increased in presence in the financial messaging sector with the acquisitions of Swiss-based Sterci and UK-based financial messaging specialist Simplex GTP. Sterci previously acquired a 51% stake in Simplex in 2011. US property and casualty insurance industry software player Applied Systems Inc. acquired insurance software company Insurecom. US private equity firm Parthenon Capital Partners has acquired leading independent securities lending agent eSecLending, whilst US-based information services provider Thomson Reuters acquired UK-based foreign exchange derivative risk management technology provider SigmaGenix.
Private equity firms remain active in the sector with Bahrain-based private equity firm Investcorp selling a 75% stake in UK online payments services firm Skrill Group (formerly Moneybookers) to CVC Capital Partners for €600m and RJD Partners selling their investment in Guernsey-based fund and services business Ipes to private equity house (and one of Ipes’s customers) Silverfleet Capital for £50m. UK mobile payments/e-commerce provider Powa Technologies also secured a $76m investment from US-based investment specialist Wellington Management which will enable the business to grow domestically and internationally, UK-based emerging markets private equity firm Actis acquired South Africa-based independent payments business Paycorp Holdings for R937 million (£61m) and UK private equity firm HgCapital acquired the international business expansion specialist Nair & Co.
Finally, the Warsaw Stock Exchange has acquired a 30% stake in Aquis Exchange, the UK-based start-up hoping to open a pan-European equities trading exchange established in late 2012 by former Chi-X Europe CEO Alasdair Haynes, for £5m.
The London Stock Exchange continues to be active with the acquisition of the derivatives business of Turquoise Global Holdings, in which it owns a 51% stake, resulting in the platform being renamed 'London Stock Exchange Derivatives Market' and operating as part of a Regulated Market of a Recognised Investment Exchange (RIE).
Investment technology has also been active with private equity firm LDC selling adviser technology provider Avelo to Australian data and software provider IRESS for £210m, private equity firm HgCapital acquiring a majority stake in back office technology firm Intelliflo with Ascentric’s white-label service Independent Funds Direct Limited understood to be putting its direct-to-consumer business Fundsdirect up for sale. Financial adviser technology business Sammedia also took a 49% stake in start-up technology firm Suitable Strategies. In insurance technology, Quindell Portfolio took a 19% strategic stake in US insurance technology business Himex Ltd.
M&A activity in the payments sector also continued with mobile point of sale business SumUp securing an investment from BBVA’s corporate venture arm BBVA Ventures in an effort to intensify its focus on the South American market, UK ATM refurbishing and manufacturing business TestLink acquiring US ATM product and service solution provider Airis ATM technologies, whilst German banknote and cash handling business Giesecke & Devrient acquired UK cash handling equipment business Currency Tech.
Finally, in the regulatory/compliance space, regulatory services provider The Consulting Consortium acquired Swaines, another regulatory services provider aimed at targeting small advisory firms and Isle of Man-based fiduciary services provider Equiom acquired fellow Isle of Man-based trust and corporate services provider City Trust.
M&A activity in FinTech continues with Progress Software agreeing to sell its Apama complex event processing platform to business process analysis platform Software AG whilst financial data specialist Markit acquired corporate action processor Global Corporate Actions and Validation Service from the Depositary Trust & Clearing Corporation (DTCC). Trading infrastructure firm CameronTec announced an agreement to acquire the capital markets solution provider E2E infotech from Aurionpro Solutions, Capita acquired data analytics and rick management firm Euristix for £9m, plus a further £3m of contingent consideration and business information provider Thomson Reuters agreed to acquire Tradeweb’s Foreign Exchange Options business.
Elsewhere, Euclid Opportunities, ICAP’s FinTech incubation vehicle, made a strategic investment in Enso Financial Management, the hedge fund and asset manager portfolio reporting and data analytics business, identity management firm GB Group acquired criminal records disclosure umbrella firm CRD and Isle of Man-based fund administrator SMP Fund Services merged with Chamberlain Fund Services.
Data continues to attract investment interest with Singapore-based sovereign wealth fund Temasek paying $500m to acquire a c. 10% stake in financial data company Markit which will enable the business to expand further outside of Europe into the US and Asia markets. Investment banking technology provider Dealogic acquired UK company research and software provider Junction RDS whilst private equity fund ISIS Equity Partners acquired call recording and analytics specialists Red Box Recorders for £14m.
Dutch software security house Vasco acquired UK-based provider of authentication for online banking applications business Cronto for €15m plus €2m earnout, the London Stock Exchange announced an agreement to acquire Italian trading platform Eurotlx from Banca IMI and Unicredit for around €40m and commercial and investment banking group Deutsche Bank announced the signing of an agreement to acquire a 51% stake in Xchanging etb GmbH, the holding company for Xchanging Transaction Bank GmbH from joint venture partner Xchanging plc for €40.5m.
In the payments sector, UK-listed electronic payment systems business Earthport announced a $10m subscription for new shares by World Bank subsidiary International Finance Corporation, the promoter of private investment into developing countries, whilst the international money transfer business TransferWise attracted a $6m investment round led by Valar Ventures, the venture fund founded by Peter Thiel, co-founder of PayPal, and Facebook’s first outside investor.
FinTech continues to be active with Ebix Inc (itself now subject to a $820m offer from Goldman Sachs) acquiring Qatarlyst, the insurance/reinsurance electronic trading exchange, US online FX/CFD trading specialist GAIN Capital rejecting an approach from FXCM in favour of acquiring FX trading business Global Futures & Forex for $107m, gaming company Bwin spinning off its payments platform Kalixa and Intralinks acquiring online deal sourcing platforms Merger ID & PE Nexus.
Trading solutions firm Equiduct sourced a new investor base including Börse Berlin, Knight Capital, BNP Paribas Securities Services, KBC Securities, Viel Group and Winterflood Securities following Citadel’s exit, Wellington IT Solutions acquired Irish credit union software provider Octagon Computer Services, Markit acquired DTCC’s stake in OTC derivative post-trade processing business MarkitSERV and information services company Experian acquired Canadian SaaS business Decision Analytics.
Finally, private equity have been active in the fund services sector with Silverfleet Capital acquiring Channel Islands-based private equity fund administration business Ipes from RJD Partners for £50m and CBPE Capital-backed business JTC Group acquired local Jersey business Ardel Trust Company.
The London Stock Exchange continues to be active having obtained shareholder support for an agreed £284m revised offer for LCH.Clearnet after the introduction of new collateral rules for clearing counterparties in Europe. Also in clearing, pan-European cash equities clearing houses EuroCCP and the European Multilateral Clearing Facility (EMCF) have agreed to merge their operations. Under the agreement, ownership of the new venture will be split evenly between four players: the DTCC, which owns EuroCPP; current EMCF owners ABN Amro Clearing Bank and Nasdaq OMX; and new partner Bats Chi-X Europe.
Private equity continue to be active in the sector with Inflexion Private Equity acquiring Sanne Group, the Channel Islands-based independent fiduciary services business. Secure electronic payment systems provider Spire Payments, owned by KleinPartners Capital Corp, acquired the mobile payment technology and products provider Thyron Payments Systems, the mobile payments business. Also in payments, financial technology company WorldPay, owned by Advent International and Bain Capital, announced the acquisition of the YESpay group of companies covering YESpay's businesses and assets including payment platforms and technologies.
Finally, Legal & General has acquired the 75 per cent of investment platform business Cofunds it does not already own for £131m from International Financial Data Services, Threadneedle, Newhouse Capital Partners and Jupiter, amongst others.
Following two announced deals in January, Ion Group continued their acquisition focus in 2013 announcing the acquisition of Ffastfill, the AIM-listed UK derivatives trading vendor, for £106.1m having previously acquired a 25.1% stake. Also on the technology side, the London Stock Exchange acquired a 67% stake in the Italian trading and post trade services technology business GATElab and Open GI, the insurance broker systems provider, acquired PowerPlace, the online insurance technology business to drive closer integration between the two businesses.
There were a number of buyout-related transactions this month: Irish payment and consulting group International Transaction Payment Solutions acquired Gibraltar-based Intelligent Payments Group alongside management, YourCash Holdings, the independent ATM provider, completed a management buy-out with funding from Pricoa Capital Group (part of Prudential Financial) and management. Also Vitruvian-owned Callcredit Information Group, the online marketing solutions business, acquired Lifestyles Online Ltd, the customer data provider.
Finally, Dunedin-owned and Jersey-based wealth management and tax planning business Hawksford Trust Company acquired wealth management and administration services provider Key Trust Company and DCM Capital, the provider of algorithmic sentiment analysis technology, took the unusual step of putting itself up for auction on its website.
Ion Group saw a busy start to the year completing two acquisitions firstly through its US subsidiary Wall Street Systems acquiring treasury management software and service supplier IT2 and also subsequently through the acquisition of US treasury management, capital market and wealth management technology business Financial Software Systems.
US private equity house TPG has also been busy announcing the acquisitions of Convergex’s order management and investment technology businesses Eze Castle and RealTick respectively with the simultaneous announcement to acquire UK portfolio management and accounting technology supplier Tradar once the Convergex acquisition is complete in Q2 2013.
Following a busy December, ICAP continue to be active with the announced sale of a 12% stake in the foreign exchange post trade processing platform Triana to seven customers (BofA Merrill Lynch, Barclays, Citi, Deutsche Bank, JP Morgan, Nomura and RBS) valuing the business at $300m with an option to buy a further 20% for up to $82.5m.
Finally Thomson Reuters sold its private client wealth management software business eXimius to Italy-based Objectway Financial Software S.p.A. and GAMCO Investors through its UK subsidiary Gabelli Securities International UK acquired Indian investment research and advisory house Horizon Market Research Pvt Ltd.