i-flex Acquires Compliance Solutions Provider Mantas

Yesterday, Mumbai, India-based financial solutions provider i-flex announced the purchase of Mantas (Herndon, Va.), an anti-money laundering and compliance software provider for $122.6 million.

The deal will increase i-flex's strength in the compliance space and generally expands the company's product line. According to Eva Weber, an analyst with Boston-based Aite Group, "This deal broadens i-flex's offerings and gives them more functionality. It enhances what they can bring to the table."

There is no doubt that i-flex is excited about the purchase, says S. Ramakrishnan, CEO of the Reveleus risk management/analytics business at i-flex. "This rounds out our risk and compliance offering nicely. Mantas' transactional behavior monitoring functionality is a good addition. It's bringing i-flex top tier financial institutions and is an opportunity for Mantas to have a greater global distribution network."

Aite's Weber admits she didn't expect to hear such an announcement from these two companies, but does say the move makes sense. "Mantas is a top vendor in the compliance space," she says. "Compliance is increasing in importance. A deal like this brings it to the forefront even more."

I-flex's Ramakrishnan expects one of the greatest benefits to its bank customers will be around simplification. "I expect our new compliance framework to be helpful for banks who are grappling with multiple solutions from multiple vendors. Our customers should expect quicker deployment, a more flexible architecture and the ability to better adapt to new regulations," he explains.

At this point, Ramakrishnan says it is difficult to tell whether the Mantas solutions will be baked into i-flex applications. What is certain is that Mantas will operate as a subsidiary of i-flex. "Mantas has a strong offering and they're very specialized so we expect to retain them as a separate entity," he relates.

Although Ramakrishnan stresses this purchase was strictly an i-flex acquisition, it should be noted that Oracle (Redwood Shores, Calif.), i-flex's parent, agreed to provide the company with additional funding, which will help with the Mantas acquisition.

In the end, Aite's Weber expects to see more purchases along these lines within the vendor community. "Compliance is always a hot button issue, so I expect to see more deals like this happen," she explains. "Banks are looking to meet regulatory demands and cut costs any way they can because they're spending a lot on compliance technology. Hopefully, a deal like [i-flex/Mantas] will ease integration issues for them. It's a big market. Consolidation is never really such a bad thing."