Atlanta-based S1 Corporation and Ramat Gan-based Fundtech Ltd. have entered into a definitive agreement, valued at approximately $700 million, to combine businesses through a stock-for-stock merger, creating an industry leader in transaction banking solutions. The combined company will be headquartered at S1’s headquarters in Atlanta and will be called Fundtech. Reuven Ben-Menachem will serve as Executive Chairman of the combined company, and Johann Dreyer will serve as Chief Executive Officer.
S1 is a leading global provider of payments and financial services software solutions to more than 3,000 financial institutions in more than 75 countries. Fundtech is a leading global provider of software solutions and services that facilitate payments, settlement and cash management for more than 1,000 financial institutions in more than 70 countries. FundTech has maintained a regional operation in Atlanta for several years. The combined company will be an industry leader in transaction banking solutions with best-of-breed technology that addresses a broad range of payment types, from card payments made by consumers to wire transfers made by large corporations.
“The S1 and Fundtech organizations and cultures are very similar in their commitment to deliver innovative products and generate the highest levels of customer satisfaction. The companies have complementary product offerings and extensive cross-selling opportunities which will position the combined company to secure larger contracts and cultivate more strategic relationships with customers,” said Reuven Ben-Menachem, Fundtech’s CEO.
The transaction, which is structured as a tax-free exchange of shares for Fundtech’s US shareholders, is subject to approval by S1 and Fundtech shareholders, receipt of regulatory approvals, Israeli court approval, and the satisfaction of customary closing conditions. Fundtech’s largest shareholder, Clal Industries and Investments Ltd., which currently owns approximately 58% of the outstanding ordinary shares of Fundtech, has entered into a voting agreement with S1 pursuant to which it has agreed, subject to the terms and conditions thereof, to vote in favor of the transaction. S1 and Fundtech expect to complete the transaction in the fourth quarter of 2011.