Money

Edinburgh fintech unicorn buys £22m turnover software firm



Edinburgh-based fintech FNZ has acquired a London provider of broking software to the wealth management industry.

The amount paid for JHC Systems was undisclosed.

 

JHC provides its technology platform to top UK and Irish wealth managers and platforms, including AJ Bell, Alliance Trust Savings, Brooks Macdonald, Charles Stanley, Davy, FIS Platform Securities, Interactive Investor, LGT Vestra and Quilter.

According to its last Companies House figures, the firm had a turnover of £22.75 million in 2017, which dipped from £24.7 million in 2016, while operating profits fell from £3.6 million to £800,000.

Its software, JHC Figaro (Figaro), JHC Neon (Neon), and JHC Xenon (Xenon), facilitates portfolio management, account administration, regulatory compliance and risk analysis for clients and financial advisers.

The independent firm, which was founded in 1988 and is owned by its founders and employees, has more than half a million end users and £160 billion in assets under management on platforms powered by JHC software. They employ around 240 people at its offices in London, Birmingham, Newcastle and Dubai.

 

FNZ, based at Tanfield in Edinburgh and employing 1,600 around the world, partners with banks, insurers and asset managers to help consumers achieve their financial goals and is responsible for more than £380 billion in assets under administration, held by around seven million customers. It was founded in New Zealand but achieved significant growth after setting up it headquarters in Scotland.

Last year, it reached so-called unicorn status with an equivalent valuation of more than $1 billion.

Adrian Durham, founder and chief executive of FNZ, said: “JHC has a market leading and well-established technology platform in the UK, combined with new state-of-the-art digital solutions.

 

“We see a great opportunity to not only consolidate our combined position in the UK market, but to take JHC technology propositions into new strategic territories – such as APAC and continental Europe – and into new product areas.” 

“JHC’s founders and management team have done a fantastic job in developing a loyal client base of more than 60 financial institutions across all asset classes, currencies and instruments.

“We look forward to working with their team to maximise the potential of JHC’s business over the coming years.”

John Blackman, chief executive at JHC, said: “Joining forces with FNZ is the perfect way for us to grow our business. It is great news for our clients as FNZ is committed to investing in Figaro, Neon and Xenon and supporting our plans for the future.

“FNZ will support JHC in enhancing and growing our SaaS offerings and gives JHC the opportunity to offer new, broader functionality to our clients.

 

“This deal will provide the scale required for JHC to compete in the increasingly competitive fintech world, particularly in wealth management where regulatory compliance and cyber security are of utmost importance.”

JHC were guided by a team from technology M&A advisors Acuity.



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