MeridianLink to be acquired by Centerbridge in a $2 billion private purchase deal
In a move that underscores the growing trend of private equity (PE) firms investing in technology companies driving digital transformation in financial services, Centerbridge Partners has announced the acquisition of U.S. financial software provider MeridianLink for $2 billion. The deal, expected to close in the second half of 2025, will take MeridianLink private, four years after its New York debut.
MeridianLink, founded in 1998 and based in Irvine, California, caters to nearly 2,000 community financial institutions and reporting agencies. The company's dealmaking appetite for software businesses has remained robust this year, as evidenced by its strong EBITDA margins at around 40%.
Jared Hendricks and Ben Jaffe from Centerbridge stated that MeridianLink is uniquely positioned to help financial institutions enhance their digital lending and credit reporting capabilities. This acquisition follows Centerbridge's acquisition of bank tech firm CSI in a $1.6 billion deal in 2022, further solidifying the firm's presence in the financial technology sector.
The deal is facilitated by optimism surrounding potential rate cuts and easing economic uncertainty due to progress on trade deals. Shares of MeridianLink increased by 24% in afternoon trading following the announcement. William Blair analyst Cristopher Kennedy expressed optimism about the acquisition, viewing the multiple as reasonable.
The acquisition highlights the current PE buyout trend in software businesses, particularly in fintech and tech-related carve-outs. PE firms are seeking growth through operational tailoring and divestitures, and despite broader market volatility, carve-outs and buyouts remain an important growth strategy in 2025.
During the three months ended June 30, MeridianLink's revenue rose 8% to $84.6 million. The net loss for the company narrowed to $3 million during the same period. MeridianLink powers digital lending and account opening for financial institutions, making it an attractive target for PE firms looking to invest in high-growth fintech companies.
In summary, the increased PE buyout activity in software businesses is driven by carve-outs and add-on acquisitions aimed at unlocking operational value and growth potential in fintech and software sectors. Centerbridge Partners’ acquisition of MeridianLink is a direct example of this trend, representing a strategic carve-out buyout of a high-quality fintech software business to optimize its growth and operational focus within a competitive PE market context. This acquisition is part of a broader pattern where PE firms deploy capital into software companies that serve fintech and financial services, leveraging operational expertise to drive returns amid stable but competitive deal conditions in 2025.
- The acquisition of MeridianLink by Centerbridge Partners, a private equity (PE) firm, underscores the ongoing trend of investing in technology companies that are transforming the financial sector, as this deal will help financial institutions enhance their digital lending and credit reporting capabilities.
- Centerbridge Partners' acquisition of MeridianLink, a high-growth fintech company, is indicative of the buyout trend in software businesses, particularly in fintech and tech-related carve-outs, as PE firms seek to unlock operational value and growth potential in these sectors while optimizing their growth and operational focus within the competitive PE market.
