Fundtech Facing $1.2B Takeover Bid From D+H

It looks like Canadian firm D+H is on its way to acquiring Fundtech in a $1.2 billion cash deal.

“I’m very proud of the company and culture that we have built and believe that D+H’s client-centric approach and FinTech expertise represent a great strategic fit for us,” said Reuven Ben Menachem, Fundtech’s founder and CEO. “Fundtech joining D+H will create new opportunities for our employees and clients alike.”

D+H’s big $1.25 billion bid for Fundtech comes as the Canadian firm is looking to expand its offerings and customer base in the global payment and cash management services sector. The new entity, if the merger is approved by regulators, will have a customer base of 8,000 clients and service eight of the world’s Top 10 banks (and 32 of the Top 50 banks).

This is the second run through with a potential acquisition. In 2001, Fundtech spent the summer in a protracted M&A drama which saw S1 attempting to merge with Fundtech, only to have ACI Worldwide gatecrash the attempt. Fundtech went on to back out of the deal with S1, instead opting for a deal with PE firm GTCR.

This time, however, it looks like the U.S.-based global payment and cash management service will actually be selling out, in this case to a Toronto-based rival.

This is one of a series of moves by D+H. The firm acquired Harland Financial Solutions – a FinTech vendor – for about the same price. Reportedly that move can be seen as an attempt on D+H’s part to tap into online, mobile and branch banking automation among Harland’s client base of community banks and credit unions.

“The complexity of today’s global payments infrastructure, proliferation of channels, and an increasing desire for real-time payments is driving demand for payment solutions that allow banks to streamline payment processing, while providing a more sophisticated and comprehensive view of liquidity management, ” said D+H CEO Gerrard Schmid.