Bravura swallows finance SaaS vendor Midwinter for $50m

ASX-listed financial software provider Bravura Solutions has snapped up Midwinter Financial Services, a Sydney-based software-as-a-service (SaaS) vendor, to complement its own offerings.

Bravura, which has a market capitalisation of $1.22 billion, on Friday announced that it had agreed to pay $50 million in cash to acquire Midwinter by the end of the month.

The deal with Midwinter comers only months after Bravura's failed bid to acquire Sydney IT service management provider GBST, for which it was willing to pay over $200 million.

“AdviceOS, Midwinter’s core product, is a natural extension to Bravura’s existing software solutions and client base, sitting alongside retirement savings, investments and life insurance,” the company said in a notice to the market.

AdviceOS is used to power back office administration for financial advisers, and drives online self-directed advice portals for superannuation funds in Australia.

Bravura said there is “significant potential” to use the platform to support traditional advice delivery methods and compliance obligations, which it noted have become stricter in the wake of the Royal Commission into the finance sector.

“The Midwinter team have built a strong, highly functional and well-regarded cloud based SaaS application for the financial advice market,” Bravura CEO Tony Klim said.

“The acquisition has a strong fit with our mission to provide best-in-class software solutions that comprehensively satisfy our clients [sic] requirements and help them navigate complex regulatory environments.”

The timing of the acquisition auspiciously coincided with the Australian Securities and Investments Commission’s (ASIC) regtech symposium yesterday, where the commission’s deputy chair, Daniel Crennan QC, warned attendees that “the status quo is no longer and option” when it comes to balancing innovation and growth with consumer rights.

“ASIC expects more. Consumers expect more,” Crennan said in his opening statement at the ASIC Regtech Financial Advice Files Symposium in Sydney.

“As our financial services systems become larger, more complex, digitised and globalised, the expectations from regulators relating to compliance and risk remain high. As technology’s potential becomes more obvious, consumers’ expectations are rising, also.

“And we do expect financial services organisations to keep up.”