Temenos and Swiss software maker Misys have reached agreement in principle on certain key terms and are continuing discussions regarding a possible all-share merger of the two groups.
Last week, the two companies have announced their plans for the merger.
Misys and Temenos say that the combination would create one of the leading companies in the financial services software industry with the prospects for long term growth.
The companies said the combined business is expected to benefit from enhanced scale and growth prospects, supported by a global, blue-chip customer base.
"It is expected that the combination will yield significant cost savings and operational synergies through scale efficiencies and cross-selling opportunities," the companies said.
Temenos and Misys believe that Temenos’ presence in banking, wealth management and business-intelligence complements Misys’ presence in core and transaction banking, treasury capital markets and lending.
Misys shareholders will own about 53.9% of the issued share capital of the combined group expected to be headquartered in Switzerland and Temenos shareholders will own 46.1%.
Misys CEO Mike Lawrie has informed that he will step down and pursue a new opportunity.
Current CEO of Temenos Guy Dubois, will act as CEO of the combined group and CFO of Misys Stephen Wilson will act as CFO of the combined group.
Both Guy and Stephen will become members of the Board of Directors which will be chaired by Andreas Andreades, currently chairman of Temenos.
It is envisaged that the Board of the combined group will comprise of nine individuals in total with 5 nominated by Misys and four by Temenos.
ValueAct Capital, the largest shareholder in Misys, has indicated its strong support for the proposed merger and will be represented on the Board.
