LONDON/FRANKFURT, Sept 1 (Reuters) - Financial software

company Finastra is exploring a sale of its Middle Eastern and

Asian core banking unit, two people familiar with the matter

said, in a deal that could fetch more than $1 billion.

The London-based company, owned by private equity firm

Vista, is working with financial advisers at Arma Partners as it

prepares to launch a sale later this year, the sources said.

The unit, which provides software to banks and credit unions

to run core processes, is expected to generate $100 million in

earnings before interest, taxes, depreciation, and amortisation

(EBITDA) this year, the people said.

A sale is expected to draw interest from other private

equity firms, as well as rivals in the financial software space,

one of the people said.

The sources, who requested anonymity because the matter is

confidential, cautioned that the discussions are at an early

stage and that no deal is guaranteed.

Vista declined to comment. Finastra and Arma Partners

did not immediately return requests for comment.

It would be the latest financial services business to hit

the block if it goes ahead, following companies such as Hg's

financial data firm FE fundinfo or the sale of Calastone to SS&C

Technologies ( SSNC ) in July.

Global M&A reached a $2.6 trillion peak in August, the

highest for the first seven months of the year since the 2021

pandemic-era, buoyed by a quest for growth in corporate

boardrooms and the impact of a surge in AI activity.

Finastra was created in 2017 by Vista, which took Canadian

payments technology provider D+H Corp private in a 4.8 billion

Canadian dollar ($3.5 billion) deal, merging it with Misys, a

banking and capital markets software business that it owned.

The sale would follow a divestment of Finastra's Treasury

and Capital Markets (TCM) division in May to Apax Partners,

which it used to fully repay debt, according to a report by

rating agency Fitch.

Finastra would also use proceeds from that sale for

acquisitions to accelerate growth or for dividends to Vista, the

report said.

Finastra recently announced a strategic collaboration with a

subsidiary of Circle Internet Group ( CRCL ) to allow banks to

settle cross-border payments faster using Circle's USDC

stablecoin.