Brazilian financial exchange operator B3 has entered into an agreement with software firm Totvs to inject BRL 600 million ($116 million) into Totvs subsidiary TFS Solucoes em Software, according to separate securities filing released by both firms on Monday.
TFS aims “to be the main option in B2B technology for the financial sector,” Totvs said. Totvs will maintain control of the subsidiary with B3 holding a minority stake.
TFS is the result of Totvs’ separation from the operation of management solutions for the financial services sector. The company has 400 employees and net revenues in 2020 of about BRL 140 million, said the companies.
TFS’ product portfolio includes a platform for investment funds, with solutions for processing and control of middle and back offices; a platform of core banking solutions aimed at small and medium-sized banks; and a processing and management platform for private label card operations, according to the companies.
“With independent and renewed management, an initial net cash position of BRL 650 million, total autonomy and focus on the booming B2B technology sector for the financial market, TFS intends to be the main B2B technology option for the financial sector,” the companies said.
For Totvs, the partnership with B3, and the consequent separation of the TFS business from the group, marks the first deal of its kind made by the corporate software group and is “an example of how we have sought creative ways to generate even more value…through the creation of joint ventures and partnerships,” the company said.
Completion of the transaction needs approval from regulatory authorities.