BBP, the Swiss subsidiary of fintech vendor Fundtech, has acquired Synergy Financial Systems, a UK Swift service bureau, in a deal worth up to £3.6 million.
Under the terms of the definitive agreement, BBP will pay an initial £2.5 million in cash, with a further potential £1.1 million in cash to be paid over three years, based on Synergy's financial performance.
The Synergy unit - which has bases in London and Nottingham - will be integrated into the BBP division which will operate both companies' service bureau facilities.
Fundtech says the acquisition will make it the world's largest Swift service bureau operator based on transaction volume, with a client base of over 200 financial institutions.
As well as connectivity, both companies offer a variety of Swift-related products and services that can be cross-sold to the newly combined client base, says Fundtech.
The vendor also plans to provide other transaction services through the UK bureau, including Sepa payments and SwiftNet offerings.
"The acquisition of Synergy offers Fundtech a unique opportunity to leverage its products and services across an expanded client base," says Reuven Ben Menachem, CEO, Fundtech. "Swift services and recurring revenue are important elements of Fundtech's growth strategy."
Fundtech expects the transaction to be neutral to EPS in 2008 and 2009, excluding non-cash charges to amortize certain acquired intangible assets.
Last month Fundtech said it would record a charge in the third quarter of up to $600,000 relating to the bankruptcy of Lehman Brothers. The fintech vendor said its investment portfolio includes a $700,000 bond issued by the bank.