A planned all-share merger of two European wealth management technology players has been abandoned.

The planned all-share merger of European financial and wealth technology firms Temenos and Misys, which had been later threatened when a US private equity house tried to gatecrash the deal, has been called off, Temenos said today.

“Further to the announcement by Temenos and Misys on 7 February 2012 that the parties were in discussions regarding a possible all-share merger, Temenos today announces that no agreement has been reached on the final terms of a transaction.  Accordingly, Temenos confirms that discussions between the two parties have now been terminated,” the Swiss-listed firm said in a statement.

The statement from Temenos made no reference to reports of late February that Vista Equity Partners had considered a bid to buy the entire outstanding share capital of Misys for cash. Reports of the Vista bid had boosted Misys' share price. As set out by the rules, Vista Equity Partners must make a hard offer by 19 March.

Under the terms of the originally announced Temenos-Misys deal, Misys shareholders would have owned about 53.9 per cent of the issued share capital of the combined group and Temenos shareholders would have owned around 46.1 per cent, after taking into account dilution from options outstanding and excluding the effects of the potential conversion of Misys’ Convertible Bond. The exchange ratio would have been 4.1 Misys shares to 1 Temenos share.

Wealth management technology firms, grappling with the challenges of developing products for a more tightly-regulated client base, are under pressure to stay efficient, encouraging M&A activity. Callataÿ & Wouters, the Belgian wealth technology firm, recently signed an agreement with France’s Sopra Group to create a new company.