Morgan Stanley and Guggenheim Securities are advising on the early-stage process, Reuters reported.
Blackstone Inc. (NYSE: BX) and Warburg Pincus are exploring a potential sale of financial technology company IntraFi at a valuation of more than $10 billion, reuters reported on Tuesday, citing people familiar with the matter.
The private equity firms have hired Morgan Stanley (NYSE: MS) and Guggenheim Securities to advise IntraFi on the sale process, which is at an early stage The owners have made no final decision and could choose to retain the business, the sources told Reuters.
Network splits large deposits among member banks
Based in Arlington, Virginia, IntraFi says more than 3,000 financial institutions use its network. Its IntraFi Cash Service (ICS) and Certificate of Deposit Account Registry Service (CDARS) distribute larger deposits among participating banks in amounts below the Federal Deposit Insurance Corp’s standard $250,000 insurance limit per depositor, per insured bank, for each account ownership category. This structure allows customers to obtain expanded deposit insurance coverage across multiple banks.
IntraFi describes its operation the largest reciprocal deposit network in the United States.
Two private equity firms share ownership
Three former bank regulators founded the business in 2002. Blackstone acquired it in 2019, erstwhile Promontory Interfinancial Network, from sellers that included Bank of New York Mellon Corp. (NYSE: BK).
Warburg Pincus invested in the company in 2022. A February 2022 European Commission decision cleared Blackstone and Warburg Pincus to acquire joint control of IntraFi’s parent, Nexus Parent LLC.
The possibility of sale has surfaced before. Bloomberg reported on Nov. 14, 2024, that the firms were considering options for IntraFi, including a sale.
Owners pursue other portfolio transactions
The potential IntraFi sale comes as both private equity firms have been involved in other portfolio transactions.
Separately, Informa plc (LSE: INF) announced on Oct. 6 an agreement to acquire event organizer Clarion Events from Blackstone. The enterprise value is £2.24 billion, including some tax benefits, Informa said.
EQT AB (STO: EQT) said on Sept. 4 that its EQT X fund agreed to acquire a majority stake in McGill and Partners from Warburg Pincus for $2 billion.
Blackstone and IntraFi declined to comment on the reported sale process, Reuters reported. Guggenheim, Morgan Stanley and Warburg Pincus did not immediately respond to requests for comment.
