selling BankVision to one of the unit's employees for $1 million.
The Monett, Mo.-based company bought BankVision Corp. in 1993 to offer multilingual, multicurrency software to banks outside of the United States. The unit has generated a loss ever since, said Michael E. Henry, chairman and chief executive officer of Jack Henry.
"Going from country to country requires tremendous amounts of changes, longer installations, more support, and is just more costly," Mr. Henry said.
Jack Henry said it would continue to target U.S.-based banks and credit unions with assets of up to $500 million, while BankVision will continue operating from its Bogota, Colombia, headquarters under its new owner, Ed Ewing. BankVision's client base, which consists mostly of South American banks but includes some in Europe and Indonesia, will be supported from offices in Colombia, Britain, and Singapore.
Without BankVision, Jack Henry will be able to focus on the "strong momentum" it has in the United States, Mr. Henry said. The firm had revenues of $141.8 million in 1998, up 72% from 1997.
Jack Henry said it does not expect the transaction to materially affect financial results for the first quarter of fiscal 2000. Selling BankVision should compensate for the $758,000 loss the unit generated for the fiscal year that ended June 30, the company said.
Jack Henry was wise to "get rid of dead weight" by selling BankVision, said M. Arthur Gillis, chief executive officer of Dallas-based Computer Based Solutions Inc.
With 80 new customers in 1998, Jack Henry is one of two "robust, prominent" software providers to community banks for core account processing, Mr. Gillis said. The other is Information Technologies Inc., the Lincoln, Neb., division of Fiserv Inc.
Forty of Jack Henry's new clients in 1998 were gained through acquisitions. The company stands to add another 87 bank customers to its client roster if its agreement to acquire the community banking division of BancTec USA Inc. goes through as expected this fall, Mr. Henry said.
The acquisition of the Dallas-based BancTec business, which provides core account processing, item processing, and check statement imaging to banks with up $500 million of assets, would be Jack Henry's largest acquisition, Mr. Henry said.
Mr. Gillis said he expects Jack Henry to make the business, which has had flat revenues, profitable. "Some companies acquire and destroy. Jack Henry acquires and enhances," he said.
Jack Henry's software is available off the-shelf or it can be outsourced from its Digital Data Services subsidiary in Miami. Its Commlink Corp. subsidiary, based in Houston, drives automated teller machines, and its Albuquerque, N.M.-based G.G. Pulley Inc. sells item processing software. Vertex Inc., based in Birmingham, Ala., sells teller software, and both Hewlett Computer Services of Cleburn, Tex., and Peerless Group of Allen, Tex., provide core data processing software.
Through these six units and its original core data processing business, Jack Henry has more than 1,810 customers nationwide.