Private equity investors HIG and General Atlantic have sold their two-thirds stake in FNZ, which provides technology services to asset managers, banks and insurers, to Generation Investment Management, the firm co-founded by former US vice-president Al Gore, and a Canadian pension fund.
The acquisition is one of the world’s largest fintech transactions this year, subject to regulatory approval, and is understood to be worth £1.65bn.
FNZ, which moved its head office from New Zealand to Canonmills, Edinburgh, in 2006, develops wealth management platform technology used by financial services firms including Standard Life Aberdeen, Santander and Lloyds Bank.
The company is responsible for more than £330bn in assets under administration held by around five million customers.
FNZ currently has some 1,400 employees across its UK and overseas offices, with 400 of these based in Scotland.
Around 400 FNZ employees are shareholders, who will continue to own about one third of the equity of the company following this transaction.
Adrian Durham, chief executive and founder of FNZ, said: “We see a unique opportunity to create a global-scale platform for wealth management. This requires a willingness to invest for the long-term.
“The firm’s 400 employee shareholders are firmly committed to this outcome and CDPQ-Generation is the perfect partner, given its unique eight to 15 year time horizon and focus on sustainable investments.”
The acquisition will be the first investment in a new partnership for Generation and Quebec-headquartered pension fund CDPQ.
David Blood, senior partner and co-founder at Generation, said: “FNZ represents an outstanding first investment for our new partnership. It is an exceptional company with a management team that has demonstrated its ability to innovate and grow in the fast-moving fintech sector.
“We believe our long-term approach will suit the company and allow it to continue to invest in its technology and service proposition to the benefit of savers and pensioners, as well its employees, customers and investors.”