Japanese tech giant NEC has agreed to acquire Swiss banking software provider Avaloq for 2.05 billion Swiss francs (around $2.2 billion). The deal marks an exit for Warburg Pincus, which had reportedly been looking to sell its stake in the business since as early as last November. NEC is understood to have beat rival bids from the likes of Apax Partners, Motive Partners and Nordic Capital. Warburg Pincus acquired a 35% stake in Avaloq in 2017, which it later increased to 45%.

Founded in 1985, Avaloq provides cloud computing to banks and wealth managers by offering business processes as a service and SaaS products. The deal, which is set to be completed in April, will see NEC jump on a growing trend of digitalization in the banking sector, as it continues a years-long restructuring aimed at both shedding unprofitable operations and moving into new business areas. Its last European deal was completed in February 2019, when it acquired Danish software company KMD for $1.2 billion.

Featured image of NEC's Tokyo headquarters via Tomohiro Ohsumi/Getty Images

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