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Japan’s NEC inks $2.2B deal for Swiss fintech company Avaloq

Tech giant NEC has signed a deal to acquire Avaloq, a Swiss provider of banking software, in a deal worth $2.2 billion.

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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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    Written by Andrew Woodman
    Andrew Woodman is PitchBook’s London Bureau Chief and oversees news coverage from Europe. Andrew has been reporting on the private markets since 2012. He was previously an editor with Private Equity International and with the Asian Venture Capital Journal. A Japanese speaker, he spent the best part of a decade in Asia, living and working in both Japan and Hong Kong.
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