SS&C acquires Iress’ managed funds administration business for A$52m

SS&C Technologies, a global provider of software and services for the financial services and healthcare industries, has completed its acquisition of the managed funds administration (MFA) business from Iress, an Australian financial services technology company. The deal, which was announced in August 2023, was valued at A$52m ($33.3m) in cash.

A strategic move to expand SS&C’s transfer agency capabilities

The acquisition bolsters SS&C’s position as the world’s leading transfer agent, significantly expanding its offering in Australia with top-of-the-line unit registry capabilities. Around 150 team members have joined SS&C Global Investor & Distribution Solutions, which focuses on transfer, unit and platform agency and administration.

“We are pleased to welcome the MFA team’s employees, customers and partners,” said Bill Stone, Chairman and CEO of SS&C. “SS&C helps asset managers globally to streamline operations, reduce risk, strengthen compliance and serve clients more effectively. We look forward to working with the MFA team to enhance our services in Australia and deliver solutions to this growing market.”

The MFA business provides unit registry services to more than 100 clients, including fund managers, superannuation funds, platforms and dealer groups. It processes over 1.5 million transactions annually and has over A$120 billion in funds under administration.

Iress divests its non-core business to focus on its core segments

Iress, which provides software and services for trading & market data, financial advice, investment management, mortgages, superannuation, life & pensions and data intelligence, decided to sell its MFA business as part of its strategy to focus on its core segments and invest in growth opportunities.

“Iress has a clear strategy to focus on growing our core segments where we have a strong market position and see significant opportunity,” said Andrew Walsh, CEO of Iress. “The sale of MFA is consistent with this strategy and enables us to increase our focus and investment in these areas.”

Iress expects the sale to have a minimal impact on its earnings per share in 2023. The company also announced that it will return up to A$100m to shareholders through an on-market share buyback program.

A positive outlook for the Australian fund administration market

The Australian fund administration market is expected to grow steadily in the coming years, driven by the increasing demand for outsourcing solutions, the rising complexity of regulatory requirements, the growing popularity of alternative assets and the need for digital transformation.

According to a report by PwC, the Australian fund administration industry is projected to grow at a compound annual growth rate (CAGR) of 6.4% from 2020 to 2025, reaching A$1.2 trillion in assets under administration by 2025. The report also highlights that the industry is undergoing a consolidation trend, with several mergers and acquisitions taking place in recent years.

The acquisition of Iress’ MFA business by SS&C is one of the latest examples of this trend, which aims to create economies of scale, enhance service offerings, expand geographic reach and gain competitive advantages.