United Fintech in Buy-up of Athena Systems - Fourth Acquisition in Just Fourteen Months
- Asset Management , Banking , IT Innovations
- 12.01.2022 01:55 pm
Setting out on a multi-stage acquisition of US-based Athena Systems, United Fintech continues its rapid expansion in pursuit of becoming the global banking industry’s ‘one-stop-shop’ for innovative capital markets products, broadening the scope to target an asset management industry in urgent need of technological innovation: “Banking and buy-side tech is starting to overlap and we are seeing very similar existential challenges”, reasons Danish CEO.
As a first step in a multi-stage acquisition, United Fintech has obtained a 25% stake in US-founded Athena Systems (“Athena” or the “Company”) for an undisclosed amount, aiming to obtain another 26% in two years and the 49% remainder in three years, in a transaction onboarding the Company, its clients and employees onto United Fintech’s digital platform. Athena, operating from offices in the US, Spain and Vietnam, services asset managers and hedge funds worldwide through its renowned Portfolio Order Management System (“POMS”) Athena Spark. And according to United Fintech CEO Christian Frahm, Athena fits hand-in-glove with his strategy of acquiring attractive and state-of-the-art Capital Markets software products ready for scaling and global roll-out on United Fintech’s platform:
“From early conversations with founders Luis Otero, Steano Guarnieri and Scott Sykowski, key staff as well as core clients, it was clear to us that Athena Systems has amazing technology, world class people and in-depth technical understanding of their customers’ needs. Making Athena part of United Fintech felt like a great match from day one and we are convinced we can scale the Company globally and together become leaders in the space within the next 3-4 years”,
says Christian Frahm.
A fintech ‘one-stop-shop’
Just recently in November, United Fintech announced the acquisition of London-based FairXchange. Over the next few years it is United Fintech’s ambition to complete multiple strategic acquisitions of ready-to-scale fintechs with proven Capital Markets products, positive cash flow and growth potential; to build a fintech ‘one-stop-shop’ that global banks and financial institutions can benefit from - and become market leader in this niche. The ambition is to help big banks and financial institutions accelerate the implementation of innovative digital technology and with the acquisition of Athena Systems, United Fintech adds a new product offering within asset management to roll out across its platform, prompting excitement from Athena Systems CEO Luis Otero as the outlook for global expansion of Athena Spark widens:
“United Fintech has the vision of creating a financial services network to serve all the biggest banks and institutional funds with a set of tools that will allow them to perform all kinds of activities without the need of any other provider and as you can imagine, this is a great opportunity for all of us. We are now part of a bigger company whose purpose is to help us scale and convert Athena into the best POMS provider in the world”,
says Luis Otero, CEO of Athena Systems.
Adapt or die
With around 130 employees spread out across Europe and the United States, and having already completed four acquisitions in just fourteen months, it may come as a surprise that United Fintech was launched little over a year ago in November 2020. However, United Fintech has been a long way coming for Danish-born Christian Frahm, who in 2016 sold his first fintech firm CFH Group to British-listed Playtech Plc., and although the deal made Frahm a familiar face in the top echelons of fintech, it didn’t fulfil the native Dane’s ambition to “save big banks from Big Tech” - a phrase which has become the informal mission statement of United Fintech. And according to Frahm, big banks are just now waking up to the reality and necessity of implementing innovative digital technology not just for their own use but to help their own customers digitize their operations and remain relevant in a fast changing industry, referencing Goldman Sachs’s recent acquisition of boutique wealth management custodian Folio as a key example of big banks buying technology solutions to help their own clients:
“The financial services industry is waking up to a reality demanding not only that they digitize, but also help their clients digitize - to survive, that is. Just like banks, the managed money space is seeing huge disruption from free stock trading, robo advisors and new fintech startups, and this is where fintech -and in particular Athena- can make a huge difference. You must keep in mind that wealth creation is at a record-pace: The sophistication levels required by asset managers today are skyhigh. If you’re a portfolio manager, you’re not just required to handle stocks and bonds; clients are demanding handling and understanding of multiple assets. Thus the managed money space is growing and expanding and it is ever-more business critical that the service providers adapt with the right tools. Banking and buy-side tech is starting to overlap and we are seeing very similar existential challenges and the choice is simple: Adapt or die”, ends Christian Frahm.