Harland Financial Solutions of Lake Mary, Fla., is being sold to Davis + Henderson Corp. in Toronto, Ontario, Canada, for $1.2 billion in cash, the companies announced Tuesday.
HFS, currently owned by Harland Clarke Holdings Corp., has about 5,400 credit union and bank clients in the United States, the companies said, including several hundred credit unions that run the UltraData core processing platform. The company also owns the Mortgagebot point-of-sale and loan origination systems and the LaserPro automated loan compliance solution.
It’s the Canadian’s company’s first core processing offering, once the sale closes in mid-August as expected, the company said. D+H cited its interest in the PhoenixEFE core processing platform, a business-services based platform used by community banks, in the acquisition, which it said would give the Canadian company a total of more than 6,200 clients in North America.
"With proven technology solutions that are mission critical for clients and complementary to our D+H offerings, solid financial performance, including strong cash flows provided under long-term contracts, and an experienced team of approximately 1,350 employees across some 17 locations, HFS adds the scope and scale necessary for D+H to be a trusted market leader in the U.S.,” D+H CEO Gerrard Schmid said in the company’s announcement.
“We also believe that this union will allow us to create even more differentiated product offerings by combining our market-leading lending solutions with HFS' strong suite of lending products," Schmid said.
The acquisition is the second major takeover of a credit union core processor this year, following the January purchase of Open Solutions by Fiserv Inc.
Callahan & Associates data show 385 credit unions running on HFS platforms. Four of them are on Phoenix, the rest on UltraData, making the company a major player in the credit union core processing market.
"We are excited by the prospect of becoming part of D+H and believe that this transaction is right for both our customers and our employees. We are joining a growing, trusted, customer focused organization that is committed to helping clients grow, compete, and offer their desired consumer experience. By combining organizations, we'll be well positioned to do even more for customers in future," said Bill Zayas, chief operating officer of HFS.
The HFS sale from Harland Clarke to D + H “ is subject to approval under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 in the U.S. and other customary conditions and is expected to occur on or about August 19, 2013,” the statement said.