MONETT, Mo. – Is Jack Henry & Associates enroute to becoming the next Fiserv? Just like the biggest technology provider in the credit union industry, Jack Henry has been growing by buying, including announcing two acquisitions on the same day in late December, bringing to five the number of companies the integrated financial services firm has picked up in the last four months. Jack Henry is perhaps best known in credit union land as the owner of the Symitar and Episys core processing platforms. Meanwhile, its latest acquisitions, announced Dec. 20, included another well-known name among credit unions: TWS Systems Inc. of Clearwater, Fla., a provider of imaged-based item and ATM processing solutions that has long focused on CUs. Terms were not disclosed. The other acquisition was the SERsynergy division of Virginia-based SER Solutions Inc., a provider of document archiving and management solutions to more than 1,600 banks, credit unions and other financial institutions. The two acquired firms have about 50 employees each. Publicly traded Jack Henry (JKHY on the Nasdaq) now has made nine acquisitions in the past nine months and 17 since 2000. Privately held TWS Systems serves more than 50 of the largest 100 credit unions in the country with its image-based item processing solutions. It also has made industry news itself with a series of prominent signings in the past few months, including $2.8 billion VyStar CU in Florida, $945 million Baxter CU in Illinois, $1.1 billion Educational Employees CU in California, New York’s $1.2 billion Municipal Credit Union and $470 million Black Hills FCU, the largest in the Dakotas. Jack Henry officials said 30 credit unions using its Episys core system are already using TWS Systems’ flagship IMAGECENTER processing platform and that the acquisition will open new markets for both. “Integrating Episys, the core processing solution offered by Jack Henry’s Symitar subsidiary and used by more credit unions with assets exceeding $25 million than any other system, with IMAGECENTER, the dominant image-enabled item processing solution, will provide a competitively distinct enterprise-wide solution, will generate growth opportunities for both platforms, and will support our collective clients with a value-added solution,” said Jack Prim, who took over as CEO of Missouri-based Jack Henry earlier this year. Kevin Williams, Jack Henry’s chief financial officer, added, “In addition to the cross-sales and new sales opportunities the IMAGECENTER platform generates, we believe acquiring TWS Systems can generate new market opportunities by adapting its industry-leading solution to support remittance check and cash payment processing for credit card and mortgage companies, government entities that collect taxes, and utilities.” The company’s acquisitions in 2004 covered a wide range of solutions and services to bolster its core offerings of integrated processing platforms and EFT and ATM solutions. For instance, it acquired Alabama’s Yellow Hammer Software for its anti-fraud tools; North Carolina-based Optinfo for software that helps financial institutions mitigate financial and operational data risk; California-based Verinex Technologies, a developer and integrator of biometric security solutions; and Select Payment Processing Inc. of Texas, a provider of ACH and electronic check processing solutions. The company is covering other bases with strategic partnerships, such as one just announced with Tangent Analytics Inc. of Winston-Salem, N.C., to allow Jack Henry to offer data warehouse and business intelligence solutions that integrate with its major core processing platforms. As for the comparison with Fiserv, Jack Henry & Associates has a ways to go before it rivals that operation. For instance, Jack Henry & Associates reported revenue of $124.1 million for the third quarter of 2004, with net income of $16.7 million and had a market capitalization of about $1.8 billion. In that same quarter ended Sept. 30, Fiserv reported net income of $80.4 million on revenues of $796.1 million, and had a market capitalization of about $8 billion. -

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