Motive Partners to acquire up to 60% stake in Fiserv’s Investment Services business
Fiserv, which will retain a 40% equity interest in the business, will receive approximately $510 million in net after-tax proceeds.
Provider of financial services technology solutions Fiserv, Inc. (NASDAQ:FISV) today announces that it has entered into a definitive agreement with private equity firm Motive Partners.
Under the agreement, Motive Partners-led investors, including Cannae Holdings, will acquire up to 60% of the Investment Services business of Fiserv. Fiserv, which will retain a 40% equity interest in the business, will receive approximately $510 million in net after-tax proceeds.
The Investment Services business is a leading technology provider for key segments of the wealth and asset management industry. Its scalable, integrated platform delivers mission-critical, end-to-end software solutions for the front, middle and back office.
The business is set to benefit from the experience and expertise of Fiserv, Motive Partners and Cannae Holdings in growing scaled financial technology businesses. It will remain committed to delivering market-leading wealth management capabilities through innovative, adviser-centric technology solutions.
The newly formed joint venture will be led by Cheryl Nash, President of Investment Services at Fiserv. Upon the closing of the transaction, Rob Heyvaert, Founder and Managing Partner of Motive Partners, will serve as Executive Chairman of the joint venture. William P. Foley II, Executive Chairman of Cannae Holdings, Dun & Bradstreet and Black Knight and Alvi Abuaf, lead Industry Partner for Motive Partners, will also join the Board.
Founded in 1979 as Security APL, the original Investment Services business platform has undergone significant investment and innovation. At present, the business is a technology provider to 7 of the top 10 US broker-dealers, and 9 of the top 12 U.S. retail asset managers. Further, the estimated addressable market for the business is significant, with a U.S. wealth management sector of over $20 trillion of assets under management and an estimated 20 million managed accounts.
Motive Partners’ innovation arm, Motive Labs, works with an international network of financial institutions, portfolio companies and strategic partners to deliver innovation services and solutions. As the Investment Services business of Fiserv positions itself as a standalone wealth technology leader, it will partner with Motive’s Industry Partners and technologists to capitalize on the client-centric value creation strategy Motive has developed.
The transaction, which is subject to customary approvals and closing conditions, is expected to close in the first quarter of 2020 and is expected to be slightly dilutive to the adjusted earnings per share of Fiserv in 2020.
