Misys Plc on Friday confirmed that it was in talks to merge with Temenos Group AG of Switzerland.
"Misys is in preliminary discussions with Temenos about a possible strategic combination to be effected by way of an all-share merger,” the London-based company said in a statement.
In a separate statement, Temenos said that it was evaluating its strategic options including an all-share combination.
Misys has a market value of £1.09bn (US$1.7bn), while Temenos is valued at 1.24bn Swiss francs (US$1.4bn) as of yesterday’s closing prices.
Misys is a global supplier of information technology solutions to the banking industry.
Misys makes software for cash, wealth and risk management as well as for loan syndication, over-the-counter derivatives trading and post-trade processing. It has more than 1,300 banking customers.
Swiss-based Temenos is a supplier of banking software systems.