NEC acquires Avaloq for $2.2B to combine biometrics and analytics with cloud services for digital transformation
NEC has announced the acquisition of Swiss financial software company Avaloq Group AG to integrate its biometrics and artificial intelligence technologies with cloud solutions for digital government.
Avaloq is the top provider of financial asset management software in Europe and the Asia Pacific region, with growth partially driven by software-as-a-service (SaaS) and business-process-as-a-service (BPaaS) solutions for wealth management and other applications.
The sale price is 2.05 billion Swiss francs ($2.2 billion), and will enable NEC to offer those cloud services integrated with its biometrics and data analysis capabilities to financial institutions, as well as governments, Reuters reports.
NEC says it plans to target the Japanese market, and the financial institutions within it that have been slow to develop digital channel services. New Prime Minister Yoshihide Suga has also stated an intension to digitally transform the country’s government services.
The financial industry in the country is responding to market changes, including a shift towards open banking, by seeking new sources of revenue from digital services, NEC says in its announcement. The company also notes momentum towards the use of digital ID to facilitate more equitable and efficient civil services by linking government and finance institutions.
“NEC will be placing great importance on building long-term relationships with Avaloq and its customers, and aims to create new solutions that combine Avaloq’s software with NEC’s cutting-edge technologies, such as its brand of biometric authentication solutions, ‘Bio-Idiom,’ the company’s AI technology brand, ‘NEC the WISE,’ and its innovative blockchain technologies,” states Takashi Niino, president and CEO, NEC Corporation. “NEC will also promote global sales expansion of Avaloq’s software by taking advantage of NEC Group sales channels, including KMD, a leading European software and IT services provider that NEC acquired in February 2019.”
The deal is expected to be completed by April 2021, subject to the usual conditions.
Vista Equity Partners and NEC have also formed a joint venture and strategic partnership to deliver Vista’s enterprise software solutions to Japanese companies.
The partners have established joint venture SaaSpresto, which is intended to help Japanese enterprises accelerate their digital transformation projects.
NEC’s facial recognition technology is part of a payment service being piloted at 30 locations in Toyama.