Brokat Internet Banking Quits U.S.; Metavante Cleans Up

It wasn’t much more than a year ago that the German-based software company Brokat Technologies said it was going to make a major push in North America. After a series of costly acquisitions, Brokat began selling off some of its business units, and in late August completed its retreat from the U.S. markets, selling its U.S. Internet banking and brokerage units to Milwaukee-based Metavante Corp., the technology unit of Marshall and Ilsley Corp.

Metavante will acquire the Brokat units for a reported $19.5 million, with the deal expected to close by the beginning of the fourth quarter of 2001, according to Todd Hutto, senior vice president and general manager of Metavante electronic banking. The deal gives Metavante 26 new Internet banking customers, including Bank of America, Bank of Hawaii and Union Bank of California. Metavante also acquires Brokat Technologies AFS, an online brokerage service. This will be Metavante’s entrance to the online brokerage business. It will gain 69 Brokat AFS clients, which includes Wall Street Access, a NYSE brokerage member firm.

Hutto says Metavante will integrate the Brokat Internet banking software, which includes consumer, small banking, and corporate platforms, into Metavante’s application service provider. Brokat had been liscensing its products to customers.All of Metavante’s existing Internet banking customers will be converted to Brokat technology, because, Hutto says, “the platform offers customers more functionality and it is better technology.” Hutto would not say specifically how long the conversions would take, but he expects it will be at least a year.

Between the two Brokat units, Metavante inherits 150 employees. Hutto said there is no plan to cut any jobs in the integration process. Brokat’s U.S. headquarters were in Norcross, GA, and Metavante will continue to operate out of this office. The Brokat AFS brokerage business unit is based in New York, and will continue to be run by Brokat employees. Hutto says Metavante plans to expand the online brokerage into its wealth management division, but could not offer any more detail.