Netzee Inc. Monday took aim at the mid- to large-sized financial institution
market by scooping up John H. Harland Co.’s Internet banking and bill
payment businesses for about $16.8 million.
Netzee swapped 4.4 million shares of Netzee common stock for the financial
software maker. Harland, which loaned Netzee $5 million, will have a 17
percent ownership interest in Netzee.
As a result, Netzee will be better armed to service major online banks
because it is adding Harland’s consumer banking, personal branch and bill
payment Internet banking products businesses, all of which Harland won when
it acquired Concentrex in August.
Netzee claims that it will be one of the largest Net banking specialists in
the U.S. when the play closes by the end of the month. Netzee will have more
than 800 financial institutions under contract with more than 700 actually
installed on one of its online banking products as well as having 700,000
e-tail customers to service.
Netzee Chief Executive Officer Glenn Sturm Monday said in a conference call
that the rising importance of in-house banking contributed to his firm’s
desire to ink the deal — that along with the fact that it will now be able
to offer quality real-time banking, something he said most large financial
service providers haven’t acquired yet.
Sturm, who said Netzee will now be in position to target mammoth banks in
the $500 billion asset capital range, said Netzee will absorb somewhere
between 170 and 200 employees who run Harland’s financial services, which
will just about double Netzee.
“We have been interested in forging a relationship with Harland for quite
some time, and this acquisition became the ideal opportunity,” said Sturm,
who also indicated that future synergies with Harland are on the horizon.
Founded in 1999 as a subsidiary of The InterCept Group Inc., Netzee was up 8.2 percent in morning trading.
