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DH Corporation acquires Fundtech for $1.25bn

Toronto-based financial technology provider DH Corporation has completed the acquisition of global payments solutions provider Fundtech for $1.25bn.

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With the acquisition, the company will be able to strengthen its position as a global FinTech provider with a strategic expansion into global payments.

DH funded the all-cash acquisition partly through a bought deal prospectus that offered subscription receipts and 5% extendible convertible unsecured subordinated debentures resulting in total gross proceeds, including the proceeds from the exercise of the over-allotment options in full, of around $950.1m.

DH sponsored the remaining amount by borrowings under its credit facilities.

DH CEO Gerrard Schmid said: "The enthusiastic support we have received from both D+H and Fundtech clients since we announced the transaction reflects the clear value creation potential of this acquisition."

"We look forward to leveraging our comprehensive portfolio of innovative technology solutions to meet the broader needs of our combined client base as we deliver an even stronger value proposition and focus on growing our presence on a global scale."

The acquisition is also a continuation of DH’s growth strategy that was given a push with acquisition of organizations including Harland Financial Solutions.

The Business Standard reported that the acquisition will affect DH’s India operations.

While Fundtech has an R&D centre in Pune, DH has a technology centre in Chennai. Fundtech also has a presence in the Americas, Europe, Middle East and Africa and APAC Region.

Fundtech India CEO Sanjay Dalmia was quoted by the Business Standard as saying: "The research and development centre of Fundtech in Pune with 600 employees and DH Corporation’s research centre in Chennai employing 300 staff would be scaled up to 1,400-1,500 staff by the end of calendar year 2015. All the 5,500 staff of the Fundtech have been retained by DH Corporation."


Image: The acquisition will have an effect on DH’s operations in India. Photo: courtesy of adamr/freedigitalphotos.net.