Temenos, a Switzerland-based banking software provider, has agreed to buy Kony Inc., the Austin, Texas-based provider of SaaS for the digital banking industry, for $559 million, plus an earn-out of another $21 million. 

Temenos said the acquisition will significantly boost its capabilities and product line in North America. Kony offers a product called the Kony Digital Banking Experience to large and mid-market banks and credit unions, which includes a suite of mobile apps to help banks deliver omnichannel experiences using artificial intelligence, augmented reality and banking through wearable technology. 

"This is the largest and most strategic acquisition in the history of Temenos," Takis Spiliopoulos, CEO of Temenos, said on a conference call.  "The acquisition will enable us to create the richest and most technologically advanced digital banking product globally." 

The digital front office banking software market is estimated to be $23 billion wordwide and $9 million in the U.S., according to the company.  

He said the deal gives Temenos additional scale, expertise, credibility and clients in the U.S. Temenos sells a digital front office product called Temenos Infinity, which helps banks with customer acquisition, onboarding, account servicing and retention and has more than 500 banking clients around the world. 

Kony chairman and CEO Thomas Hogan will become president of Temenos North America and join the Temenos Executive Committee when the transaction closes. The deal is expected to close early in the fourth quarter, Spiliopoulos said.