Fiserv, the third-largest provider of financial services technology on the FinTech 100 ranking, Monday announced it has acquired Open Solutions, a smaller provider of core banking software. The purchase price was $55 million, and Fiserv assumed approximately $960 million of debt.
Open Solutions is a Glastonbury, Conn.-based technology provider to banks, thrifts and credit unions that's currently ranked 36th on the FinTech list. The company's key products include DNA, a real-time core banking platform; DNAcreator, a developers' toolkit that lets banks and credit unions create their own apps for the DNA platform; and DNAappstore, an Apple-inspired app store for programs created with DNAcreator. One of Bank Technology News' Innovators of the Year, Harry Gunsallus, senior vice president, technology and operations support at Redstone Federal Credit Union, Huntsville, Ala., won for building his own apps in DNAcreator and selling them on the DNAappstore. For instance, the credit union's Overdraft Research Tool has been purchased and used by several other DNA customers.
Through this acquisition, Brookfield, Wisc.-based Fiserv will also acquire Open Solutions' CUnify and TotalPlus account processing platforms; Weiland Account Analysis for commercial account analysis; and Raddon Financial Group, a technology performance consultancy.
Open Solutions serves more than 3,300 clients worldwide, including more than 800 account processing clients. These clients will have access to Fiserv's products, such as its CheckFree RXP electronic bill payment service, ACCEL/Exchange payments network, debit processing services, Popmoney social payments service, Corillian Online banking, and Mobiliti mobile banking.
Open Solutions' low purchase price and high debt load stand against a backdrop of a lawsuit filed in September by Michael Nicastro and Andrew Bennett, shareholders and former executives of Glastonbury, Conn.-based Open Solutions. Their complaint said the software maker may have misled investors about its condition and declined financially.
At the time, Open Solutions' management and private equity partners were rumored to be selling the company. Initial bids valued the business at $1 billion, the Wall Street Journal reported in April, citing unnamed sources.