In a move that suggests the banking technology industry could be entering a new period of vendor realignment and deal-making activity, Jacksonville, Fla.-based FIS, one of the world's largest global providers dedicated to banking and payments technologies, announced it has signed a definitive agreement to acquire Capco (Antwerp, Belgium), a global business and technology consultancy dedicated solely to the financial services industry.
The addition of Capco expands FIS' established international presence and footprint among large U.S. and global financial institutions through the addition of a professional services offering that covers the full financial services value chain, according to the companies.
Capco, with more than 1,000 professionals worldwide, applies domain expertise in banking, capital markets, wealth and investment management, finance, risk and compliance and technology. "Capco is well known for its thought leadership and client-centric model that distinguishes it from other consulting firms," stated Frank Martire, FIS president and CEO, in a press release. "The addition of Capco will greatly enhance the value we bring to our clients through the powerful combination of FIS' breadth of technology solutions and Capco's strong knowledge base and global industry expertise."
Commenting on the transaction, Rob Heyvaert, Capco founder and CEO, said in the press release, "Combining Capco's collaborative consulting services with FIS' industry leading core banking and payments solution suite will enable both organizations to better leverage our individual strengths while providing our respective clients with a unique blend of market expertise, technology solutions and strategic support."
Heyvaert will continue to lead Capco, reporting to Martire. According to the companies, Capco will retain its brand identity and the existing management team remains unchanged. Heyvaert becomes a corporate executive vice president of FIS. He also becomes a member of the FIS Executive Management team. In his broader role, he will be responsible for the strategic direction of FIS' consulting services.
The transaction closing is expected by year end. Capco's current majority shareholder, Palo Alto, Calif.-based private equity firm Symphony Technology Group (STG), will not retain any equity or interest in the combined entity on completion of the transaction. Capco is expected to generate approximately $225 million in revenue in 2010, approximately half of which is generated outside North America. The purchase price includes cash at closing of $292 million and additional consideration contingent upon future performance of the business.