SoFi (NASDAQ:SOFI) has announced the acquisition of Technisys.
In a release, SoFi said it has signed a merger agreement with Technisys, a digital banking platform.
Technisys’ shareholders will receive approximately 84 million shares of SoFi common stock or less than 10% of SoFi’s fully diluted share count as of September 30, 2021. The valuation of the merger was set at approximately $1.1 billion. The deal is predicted to close in Q2 of 2022.
Anthony Noto, CEO of SoFi, issued the following statement on the acquisition:
“Technisys has built an attractive, fast-growth business with a unique and critical strategic technology that all leading financial services companies will need in order to keep pace with digital innovation. The acquisition of Technisys is an essential building block in delivering on our member-centric, digital one-stop-shop experience for SoFi members and our partners through Galileo, our provider of Fintech cloud services, Under the leadership of co-founder and CEO, Miguel Santos, Technisys has emerged as a proven leader in Gen 3 multi-product banking core technology. We are excited to bring their technology offering under the SoFi Technologies umbrella and deliver it to hundreds of millions of customers worldwide.”
SoFi’s ambition is to create the “AWS of Fintech.” By acquiring Technisys, SoFi aims to be able to better provide the full stack of digital banking services like: checking, savings, deposits, lending, and credit cards – as well as future products.
SoFi pointed to Technisys’ more than 60 established bank, Fintech, and non-financial brands in Latin America and the U.S., and an addressable market across 16 countries.
The estimated incremental revenue from the acquisition, including base revenue of Technisys and revenue synergies of the vertically integrated capabilities, is expected to add a cumulative $500 to $800 million through year-end 2025, at high incremental margins.
“We are thrilled to bring Technisys’ technology, customer base, and expertise to the larger SoFi Technologies platform,” said Santos. “We are confident that together, we can offer a best-in-class financial experience for traditional and non-traditional financial services players alike at a greater velocity than ever before.”
The transaction is emblematic of the digital transformation of all banking services and a move towards banking everywhere – not just in a single app. SoFi’s mission is to be the one banking platform to provide services for a diverse and global client base.
Shares of SoFi were down slightly today – along with the broader market due to the Russian invasion of Ukraine.