On October 5, Japan’s NEC Corp. announced that it will purchase Swiss financial solutions provider Avaloq Group AG for CHF 2.05 billion (USD 2.25 billion), making it the biggest acquisition ever for NEC.
The aim is to gain Avaloq’s digital finance platform and data analytics solutions and combine it with NEC’s biometric, AI and blockchain technologies to bring new solutions mainly in the field of financial asset management. Future collaboration is anticipated in areas of digital government, too.
NEC views Avaloq’s key strength in three areas; (1) core banking systems especially in financial asset management with a track record of stable, high-quality operations (2) personalized advisory on asset management and (3) real-time communication with customers.
Expected synergies from the technological perspective were laid out in three domains. Firstly, in biometrics where NEC’s technologies for personal authentication and digital identity verification can be adopted in Avaloq’s solutions for improved accuracy and usability.
The second synergy is expected in big data and analytics. NEC’s analytics technology utilizing artificial intelligence technologies can provide various big data on markets, insurance products, real estate investments, securities trading and asset management, to strengthen Avaloq’s market forecast, portfolio optimization, personalized recommendations, simulation and anti-money laundering fraud detection services.
Thirdly, the development of secure and real-time government-financial collaboration services is another goal of the acquisition. The idea is to use NEC’s blockchain technologies in order to digitalize financial assets data such as virtual currency, insurance, real estate, securities and accounts, as well as administrative data including public ID, taxes and pension, and enable new services.