Blackstone (BX.US) and Warburg Pincus Reportedly Plan to Sell IntraFi, Valuation May Exceed $10 Billion

Blackstone Inc. (BX.US) and Warburg Pincus are exploring a sale of IntraFi, a deal that could value the fintech company at more than $10 billion, according to people familiar with the matter. The two private equity firms have hired Morgan Stanley and Guggenheim Securities to advise IntraFi on the sale process, which is still in its early stages, the people said. No final decision has been made and Blackstone and Warburg Pincus could also choose to retain the business, the people added. Arlington, Virginia-based IntraFi operates what it describes as the largest reciprocal deposit network in the U.S., helping banks spread customer funds across multiple banks to provide federal deposit insurance on balances exceeding $250,000. The company's network also allows banks to buy and sell deposits. Banks with excess deposits can sell them to banks in need of funds, and IntraFi collects fees from these transactions. After the collapse of Silicon Valley Bank in 2023, customers became more discerning about where they place their money, intensifying competition among banks for deposits. IntraFi was founded in 2002 by three former bank regulatory officials and was acquired by Blackstone in 2019 from a group of backers, when the company was named Promontory Interfinancial Network. The backers included TrustCo Bank Corp NY (BNY.US). Warburg Pincus invested in the company in 2022. IntraFi has annual EBITDA of $630 million, according to the people familiar with the matter. The sale process comes as private equity firms seek to capitalize on an improving dealmaking environment. Warburg Pincus recently agreed to sell McGill and Partners and WildFire Energy; Blackstone this month agreed to sell Clarion Events to Informa for about 2.2 billion.