Finance firm Fiserv's $650 million buy of Florida-based Finxact means millions of dollars for a North Carolina bank.
Wilmington's Live Oak Bancshares (NASDAQ: LOB) was an early investor in Finxact and, per a securities filing, expects to realize a pre-tax gain of about $115 million once Fiserv's buyout closes.
Company executives were not available to answer questions about the deal earlier this week — but Fiserv's top brass did talk about the pending buy on the firm's earnings call Feb. 8.
Fiserv CEO Frank Bisignano said the deal “supports our strategy to continuously innovate for our clients and broaden our total addressable market.”
“Finxact will not only augment our ability to enrich and accelerate the delivery of digital solutions we offer to our existing clients, but also broaden our solutions to include large financial institutions, fintechs, banking-as-a-service and embedded finance opportunities,” he told analysts.
Fiserv, like Live Oak, was an early investor in the technology, and the deal has it acquiring the remainder of its shares.
Finxact is one of multiple fintech startups linked to Live Oak, which has actually spun out tech firms in recent years, such as the now-publicly traded nCino (NASDAQ: NCNO).
Finxact was founded in 2016 and provides clients with a banking solution that allows financial institutions enhanced access to their data.
Finxact has raised at least $42 million from investors since its founding, including $12 million in 2017 and $30 million in 2019 from investors including the American Bankers Association, Accenture Ventures, SunTrust Bank and First Data.
