Temenos to Acquire Kony in $559 Million Deal
"The acquisition of Kony, the U.S. #1 digital banking SaaS company, is highly strategic and will allow us to grow ..."
Two organizations serving credit unions head to a deal. Switzerland-based banking software company announced an agreement to acquire Austin, Texas digital banking SaaS firm Kony. The acquisition enhances Temenos’ U.S. scale and capabilities.
Geneva-based Temenos, which has its U.S. headquarters in Malvern, Pa., said the acquisition adds significant digital expertise and accelerates Temenos Infinity, their digital front office product, which has over 500 banking clients. Thomas E. Hogan, chairman and CEO of Kony, will become President of Temenos North America and join Temenos’ Executive Committee, effective on the acquisition closing date. Temenos has agreed to purchase Kony for an enterprise value of $559 million and an earn-out of $21 million, subject to regulatory approvals.
Kony has achieved rapid growth with both top tier and mid-market financial institutions in the U.S. and internationally with its Kony Digital Banking Experience product (Kony DBX). Kony, with 1,500 employees and deep expertise in digital and cloud technologies, helps credit unions and banks transform the digital banking experience with applications and its development platform, served through a cloud hosted software-as-a-service model.
The Kony DBX product includes a suite of mobile banking apps delivering exceptional omnichannel experiences including support for conversational interfaces, artificial intelligence, augmented reality, and wearable technologies. Key to this success, according to the Texas company, is Kony’s development platform that accelerates product cycles and increases agility by reducing the load on bank IT to design and iterate user experiences. Kony’s banking clients, including a number of credit unions, have transformed the banking experience with some achieving over 20% increase in mobile deposits, 64% increase in mobile credit card payments and significantly reducing abandonment rate from 20% to 3%.
The combination of Temenos, Kony and the recently acquired Avoka, which Temenos acquired last December for $245 million is expected to further strengthen the Temenos Infinity product, covering all banking verticals offering customer acquisition and onboarding, omnichannel banking, customer retention and marketing, and modules supporting payments, wealth advisor, financial crime, risk and compliance and analytics.
Temenos Infinity deliverable on-premise, in any cloud or as a SaaS offering, has 700 published APIs for third-party integration. According to the Swiss-based firm, financial institutions can implement Temenos Infinity, on any core banking system or integrated with the Temenos T24 Transact core banking product.
Max Chuard, CEO, Temenos, said, “The acquisition of Kony, the US #1 digital banking SaaS company is highly strategic and will allow us to grow both our U.S. and our digital front office business faster, while being highly accretive and synergistic to the rest of our business. We are acquiring a digital front office product that has already been successful in the U.S. market and is connected to most third-party cores.”
Thomas E. Hogan, chairman and CEO, Kony, Inc., said, “I could not be more excited about joining Temenos and the combined value we will bring to financial institutions around the world. The power of the Temenos portfolio, combined with Kony’s digital banking applications and multi-experience development platform, will bring the industry’s most robust suite of applications for delivering service, value, and efficiencies from the digital edge to the modern core.”