(Bloomberg) -- Billionaire Robert F. Smith’s Vista Equity Partners is weighing a sale of one of the divisions inside the fintech behemoth Finastra, according to people familiar with the matter.
The buyout fund has held early discussions about a potential sale of Finastra’s TCM business with advisers and may kick off the process later this year, said the people, who asked not to be identified as the information is private. Vista is hoping to fetch a valuation of at least $2 billion for the business, they said.
The TCM unit could ultimately attract other financial software firms, stock exchanges and financial institutions, according to the people. Considerations are at an early stage and Vista could still decide against doing a deal, the people said.
Spokespeople for Vista and Finastra declined to comment.
Vista previously tried to offload Finastra’s treasury and capitals market unit as well as the banking software division in 2021. Last year, Vista opted for a large refinancing of the fintech firm.
That refinancing went on to capture the attention of legions of Wall Street bankers and traders when titans of private credit including Blue Owl Capital and Oak Hill Advisors stepped up to provide a record $4.8 billion fully funded direct loan for the deal. At the time, the new loan highlighted that the private credit market was rapidly reshaping how private equity firms fund buyouts.
London-based Finastra was formed through a merger between Misys Group, the capital markets business owned by Vista at the time, and Canadian payments firm D+H Corp. in 2017. D+H traces its roots back to 1875, when it started off specializing in bookbinding and printing.
Finastra now generates about $1.85 billion in revenue with about 8,100 customers. The TCM business accounts for about $400 million of that, according to one of the people familiar with the matter.
The treasury and capitals markets business provides software for financial institutions that helps with every aspect of running such companies, including processing trades, managing risks and compliance.
The unit’s main competitors include Nasdaq Inc.’s financial technology unit, Paris-based Murex, Florida-headquartered Fidelity National Information Services Inc. and the markets business of Ion Group. Last year, Nasdaq bought financial-software maker Adenza from Thoma Bravo for $10.5 billion, the exchange operator’s biggest-ever deal.
(Updates with related Nasdaq acquisition in final paragraph. A description of the TCM unit’s business was corrected in an earlier version of this story.)
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