Magazine article American Banker

Fidelity's Shopping Abroad Raises Concern about Focus

Magazine article American Banker

Fidelity's Shopping Abroad Raises Concern about Focus

Article excerpt

After an aggressive acquisition campaign in this country, Fidelity National Financial Inc. is turning its attention elsewhere.

The Jacksonville, Fla., technology outsourcer said Tuesday that it is buying 74.9% of Kordoba GmbH & Co. KG, a German provider of core-banking software and services.

Analysts said the deal underscores an ambition to move beyond the domestic market but could make it harder for Fidelity National to promote its growing product list.

Fidelity National declined to say how much it would pay. The seller, Siemens Business Services GmbH & Co. OHG of Munich, would retain a 25.1% interest in Kordoba.

The purchase, which is expected to close by Sept. 30, would position Fidelity National "to benefit from the growth opportunity in the German core-processing market," said William P. Foley 2d, its chairman and chief executive, in a press release. Kordoba will provide "a significant foundation in this key European economy to assist in the realization of our overall expansion plans throughout Europe,"

A spokesman said Fidelity National could not go beyond the release. It is in a mandated quiet period as it prepares to spin off its tech operations as Fidelity National Information Services Inc. The spinoff may not be complete until mid-2005.

Kordoba provides core transaction processing software and outsourcing, mostly to German savings and commercial banks. It also offers automated teller machine driving; accounting and reporting; and securities processing.

In its last fiscal year, which ended Sept. 30, Kordoba earned about $29 million, before interest and taxes, on about $105 million of revenue.

Bill Bradway, the group vice president of retail financial services at Financial Insights Inc., a research firm in Framingham, Mass., said the deal could open the door for Fidelity National in other parts of Europe. …

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