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Fifth Third (FITB) Eyes Acquisition of Big Data Healthcare
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Fifth Third Bancorp (FITB - Free Report) announced a definitive agreement to buy Big Data Healthcare, a technology solutions provider, for healthcare payments and remittances. With this deal, the bank will add national healthcare revenue cycle capabilities, thereby enhancing its legacy of digital innovation and focus on the healthcare sector.
The acquisition will be made throguh one of Fifth Third’s indirect wholly-owned subsidiaries and is subject to customary closing norms. The financial terms of the deals have been kept under wraps.
Founded in 2017, Big Data Healthcare optimizes healthcare results with the help of intelligent data automation. Its core solution FUSE is an online portal automating remittance reconciliation back to deposits. It also offers visibility, thereby improving data and file management, while working in tandem with existing systems.
Per FITB management, “The healthcare industry is one of the largest and fastest growing segments of the U.S. economy. It’s the first and the largest of our industry focus areas.”
Markedly, FITB has expanded its fee-income base over the years on strategic acquisitions, thereby enhancing its digital bank product offering. In May 2022, Fifth Third completed the buyout of Dividend Finance in a bid to grow its digital service capabilities.
In August 2021, it completed the buyout of Provide, a digital platform for healthcare practices. In 2018, it acquired Coker Capital, a healthcare merger and acquisition advisory firm. These buyouts expanded commercial verticals and are expected to drive revenue growth.
The company’s strong balance sheet also supports such inorganic moves. As of Dec 31, 2022, it had long-term debt of $13.4 billion, which increased sequentially. Nonetheless, total liquidity stood at $102 billion as of the same date. Finally, the company’s senior debt enjoyed investment-grade credit ratings of BBB+, A- and Baa1, from Standard & Poor’s, Fitch, and Moody’s, respectively. This will likely enable the company to access the debt market at favorable rates.
Over the past six months, shares of FITB have declined 4.1% against the industry’s growth of 4.9%.
Amid a challenging operating backdrop due to the expectations of an economic slowdown, finance companies are undertaking expansion moves through acquisitions. Recently, Bank of Montreal (BMO - Free Report) announced the closure of its acquisition of Bank of the West from BNP Paribas (BNPQY - Free Report) .
With the deal, BMO expands its presence across more than 500 additional branches and commercial and wealth offices in the major U.S. growth markets. For BNPQY, the sale is part of its efforts to streamline operations and enhance operating efficiency.
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Fifth Third (FITB) Eyes Acquisition of Big Data Healthcare
Fifth Third Bancorp (FITB - Free Report) announced a definitive agreement to buy Big Data Healthcare, a technology solutions provider, for healthcare payments and remittances. With this deal, the bank will add national healthcare revenue cycle capabilities, thereby enhancing its legacy of digital innovation and focus on the healthcare sector.
The acquisition will be made throguh one of Fifth Third’s indirect wholly-owned subsidiaries and is subject to customary closing norms. The financial terms of the deals have been kept under wraps.
Founded in 2017, Big Data Healthcare optimizes healthcare results with the help of intelligent data automation. Its core solution FUSE is an online portal automating remittance reconciliation back to deposits. It also offers visibility, thereby improving data and file management, while working in tandem with existing systems.
Per FITB management, “The healthcare industry is one of the largest and fastest growing segments of the U.S. economy. It’s the first and the largest of our industry focus areas.”
Markedly, FITB has expanded its fee-income base over the years on strategic acquisitions, thereby enhancing its digital bank product offering. In May 2022, Fifth Third completed the buyout of Dividend Finance in a bid to grow its digital service capabilities.
In August 2021, it completed the buyout of Provide, a digital platform for healthcare practices. In 2018, it acquired Coker Capital, a healthcare merger and acquisition advisory firm. These buyouts expanded commercial verticals and are expected to drive revenue growth.
The company’s strong balance sheet also supports such inorganic moves. As of Dec 31, 2022, it had long-term debt of $13.4 billion, which increased sequentially. Nonetheless, total liquidity stood at $102 billion as of the same date. Finally, the company’s senior debt enjoyed investment-grade credit ratings of BBB+, A- and Baa1, from Standard & Poor’s, Fitch, and Moody’s, respectively. This will likely enable the company to access the debt market at favorable rates.
Over the past six months, shares of FITB have declined 4.1% against the industry’s growth of 4.9%.
Image Source: Zacks Investment Research
Currently, FITB carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Inorganic Expansion Efforts by Other Firms
Amid a challenging operating backdrop due to the expectations of an economic slowdown, finance companies are undertaking expansion moves through acquisitions. Recently, Bank of Montreal (BMO - Free Report) announced the closure of its acquisition of Bank of the West from BNP Paribas (BNPQY - Free Report) .
With the deal, BMO expands its presence across more than 500 additional branches and commercial and wealth offices in the major U.S. growth markets. For BNPQY, the sale is part of its efforts to streamline operations and enhance operating efficiency.