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SS&C acquires DST Systems in $5.4 billion deal

SS&C plans to push further into the US wealth management market through new financial technologies and solutions.

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SS&C has announced the acquisition of DST Systems in a deal worth $5.4 billion.

On Thursday, investment management software provider SS&C revealed the buyout following the temporary suspension of Kansas City-based DST Systems trading on Wednesday.

In a statement, SS&C said that under the terms of the deal, DST will be purchased for $84 per share in an all-cash transaction worth a total of $5.4 billion, including the assumption of debt.

DST Systems is a provider of technology-based information processing and servicing solutions for financial markets including asset management, retirement, banking, and insurance. The company generated $2.3 billion in revenue in FY 2016 -- 2017.

SS&C says the acquisition will "significantly increase" the company's scale, with roughly $3.9 billion in combined pro forma revenue and roughly 13,000 clients now coming under the same umbrella.

"Additionally, the transaction expands SS&C's footprint into the US retirement and wealth management markets and adds 110+ million investor positions across DST's client base," SS&C added. "The combination leverages SS&C's market-leading software platform for institutional and alternative asset managers to drive increased automation and efficiency across wealth management account servicing."

The deal builds on SS&C's purchase of DST Global Solutions in 2014 for $95 million.

DST employees are expected to join SS&C's team worldwide and the firm expects to save up to $150 million annually by 2020 through the buyout and DST's resources.

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The deal has been approved by SS&C's and DST's boards and the transaction is expected to close by Q3 2018, subject to regulatory approval.

Credit Suisse and Morgan Stanley served as financial advisors and have committed to debt financing.

"We are pleased to enter into this agreement with SS&C, which benefits DST shareholders and supports the continued success of our clients," said Steve Hooley, Chairman, and CEO of DST. "SS&C has a rich history of delivering best-in-class technology that complements DST's existing solutions, and, as part of SS&C, we will be able to advance our extensive, multi-year strategic transformation."

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