If you can't beat 'em, buy 'em. Fiserv Inc. announced late yesterday that it has purchased rival financial services technology provider Open Solutions.
Through the acquisition of the Glastonbury, Conn.-based Open Solutions, Fiserv will expand its product offerings with several new technologies, the company said in a news release. These include DNA, a real-time, open technology account processing platform, which enables collaboration and technology-sharing through DNAcreator and DNAappstore to deliver localized customer-facing value.
Fiserv will acquire a number of account processing and analysis solutions, as well as Raddon Financial Group, a provider of performance consulting services. No less importantly, the company will acquire an Open Solutions client base of more than 3,300 clients worldwide, including more than 800 account processing clients, opening new selling opportunities for its own add-on solutions.
"Joining Fiserv provides us with significant resources that will benefit our clients and increase market momentum," said Open Solutions Chairman and CEO Louis Hernandez Jr. "We are delighted to join Fiserv, a leader in the delivery of innovative financial services technologies."
"Open Solutions provides several growth opportunities, including a real-time account processing capability that serves multiple charter types, languages and currencies on a single platform," said Fiserv President and CEO Jeffery Yabuki. "Open Solutions' strong team of associates is intently focused on client success and committed to collaborative technology, which will enhance the value we provide to our clients."
To acquire Open Solutions, Fiserv paid a $55 million purchase price and assumed approximately $960 million of debt. Fiserv will benefit from an acquired tax asset with a net present value at the time of purchase of approximately $165 million.
Resulting from the acquisition, Fiserv expects to achieve annualized revenue synergies of at least $75 million and annualized cost synergies in excess of $50 million over the next several years.
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