Two potential fintech deals are in the works as EQT, one of the biggest European private equity firms, has put Rimes Technologies up for sale, while Bluefin Payment Systems is also seeking a buyer. This news, however, comes at a time when there is meager appetite for mergers.
Last year was considered a slow year for mergers, but 2024 is turning out to be even worse. Globally, the number of announced deals so far this year has dropped by nearly 40% to 2,470 mergers, while their valuation rose by 19% to about $249 billion, according to Feb. 5 data from Dealogic. This means that while there were fewer transactions, the deals were bigger, like BlackRock’s $12.5 billion buy of Global Infrastructure Partners and Synopsys’s $33.8 billion acquisition of Ansys. The same trend was found in the U.S; announced mergers fell by nearly 42% to 769 but totaled $162 billion, a 49% increase from February 2023.
The slowdown in merger activity is due to the bid-to-ask spread between buyers and sellers, several bankers have told Fortune. This refers to the asking price sought by a seller and the bid price offered by a potential buyer. Sellers are still seeking the sky-high prices of 2021, these people said.
Some potential sales are moving forward all the same, though. Books for EQT are slated to go out this month with Evercore advising, three banking executives said. Bloomberg in October reported that a sale of Rimes could value the company at 2 billion euros ($2.1 billion). Rimes is more likely to get around $1 billion, the banking sources told Fortune.
Founded in 1996, Rimes provides managed data and regulatory technology services for asset managers, asset services, and institutional investors. Customers include HSBC, J.P. Morgan Asset Management, and Invesco. EQT, which went public in 2019 on the Nasdaq Stockholm Stock Exchange, invested in Rimes in February 2020. It’s unclear how much EQT provided.
In another deal, Bluefin is on the block, according to four different banking and private equity executives. Guggenheim Securities is advising on the process, they said.
Launched in 2007, Bluefin provides payments and data security technology to 35,000 companies in 59 countries. The company has raised $31 million in funding, according to Crunchbase. That includes a $25 million investment from Macquarie Capital Principal Finance, a unit of Macquarie Group, in 2020, according to a statement. Other investors include Napier Park Global and Camden Partners.
Bluefin generates $80 million in revenue and is expected to sell for six to seven times, or $480 million to $560 million, one of the sources said.