Vista Equity Partners LLC has agreed to buy Canadian financial services provider DH Corp. and will combine it with financial software company Misys Ltd. to create a “financial technology powerhouse.”
Bloomberg Technology reports that the deal values DH Corp. at around C$2.73 billion ($2.03 billion), which is an 11 percent premium above the company’s closing price on Friday of C$23.04 a share.
As the Toronto-based company’s check-making business has declined, so have DH Corp.’s shares, falling 37 percent in the year through Friday. But once the deal with Vista was announced, DH Corp.’s shares rose 9 percent to C$25.12.
The company services 8,000 banks, specialty lenders, credit unions, governments and corporations, with more than 5,500 employees around the world and revenue of almost C$1.7 billion in 2016. But as the need for its services has decreased, DH Corp. has focused more on moving into the financial technology sector. In 2015, it acquired Fundtech Ltd., a payment technology provider, for $1.25 billion.
Vista’s transaction for DH Corp. is valued at C$4.8 billion, including debts. Vista, which has offices in Austin, Texas, Chicago and San Francisco, took Misys privately in 2012 for £1.3 billion ($1.6 billion), but canceled its planned initial public offering in October due to market conditions.
Morgan Stanley, Barclays Plc and Citigroup Inc. served as advisers to Vista on the transaction, while Kirkland & Ellis and Goodmans provided legal advice. DH Corp. worked with Credit Suisse Group AG and Royal Bank of Canada, with legal counsel from Stikeman Elliott and Cravath Swaine & Moore.
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