Advent Software, the US-headquartered fintech firm serving wealth management and other firms, is to be acquired, the firm has announced.

Advent Software, the fintech firm serving sectors including wealth management, announced a 3 per cent year-on-year rise in revenue in the fourth quarter of 2014, as the firm also announced it had agreed with SS&C Technologies Holdings that the latter firm will acquire Advent in a $2.7 billion deal.

In its results, San Francisco-headquartered Advent Software reported quarterly revenue of $100.7 million for the fourth quarter of 2014, compared to $97.6 million in the fourth quarter of 2013.

Revenue for the year ended 31 December 2014 was $396.8 million, compared to $383.0 million in 2013, a 4 per cent increase.

Net income for the fourth quarter of 2014 was $14.7 million compared to $11.0 million in the fourth quarter of 2013, a 33 per cent increase.

Late yesterday, it was announced – confirming some media speculation – that SS&C Technologies Holdings and Advent Software had entered into a definitive agreement wherein SS&C will acquire Advent. SS&C will purchase Advent for an enterprise value of approximately $2.7 billion in cash, equating to $44.25 per share plus assumption of debt.

Given the highly complementary nature of the acquisition, the firms said, the specific cost synergies and the significant cash flow available for deleveraging, SS&C expects to deliver fiscal 2016 earnings per share of between $3.05 to $3.15.

In after-hours trading, shares in Advent were quoted up 5.8 per cent.

"Advent increases SS&C's business and geographical diversification and scale and adds a stable and attractive revenue base, as demonstrated by its 90 per cent recurring revenue rates over the last five years. Meanwhile, the companies' combined solutions and services will drive stronger long-term growth for the pro forma business and present significant cross-sell and cost savings opportunities," a statement on the Advent website said.

The deal continues SS&C's growth strategy through acquisitions in the financial services software and software-enabled services industries, as demonstrated by 40 acquisitions to date including GlobeOp in 2012 and DST Global Solutions in 2014, the statement said.

"Cost synergies derived from this transaction are estimated to be approximately $45 million of annual savings achieved by the end of three years, and SS&C expects meaningful revenue synergies to be derived over time. Altogether, SS&C expects the transaction to be accretive to its overall financial profile, enhancing top line growth, margins, cash flow and non-GAAP earnings per share. Given the highly complementary nature of the acquisition, the specific cost synergies and the significant cash flow available for deleveraging, SS&C expects to deliver FY 2016 EPS of between $3.05 to $3.15," said Peter Hess, chief executive of Advent Software.

"Without a doubt, we have seen a renewed wave of consolidation among technology and service providers catering to the wealth management space and there is no end in sight. Entities like Envestnet, Morningstar or SS&C have played their financial muscles and have taken advantage of the opportunities that the market offered to them. In the case of Advent Software, it seems the catalyst for the deal was the desire of key shareholders to transition their stakes to a new owner. A sale of Advent Software was rumored for over a year and SS&C is one of a few market players that is in the position to finance a deal even only a few months after the firm acquired DST’s London-based software arm," Alois Pirker, Research Director in Wealth Management at Aite Group, said in a note about the Advent deal.