New York-based analytics firm Axioma revealed this week that, in the Q3, 2019, the company will be acquired by German exchange organization, Deutsche Börse for a total cash consideration of US$850mn. After the acquisition is completed, Axioma will be combined with Deutsche Börse’s index businesses, STOXX and DAX, valued at $2.6bn.
As part of the transaction, Deutsche Börse is partnering with General Atlantic, a global growth equity investor that will invest approximately US$715mn into the new company to help fund the Axioma purchase.
The new entity will be, according to Deutsche Börse, a fully integrated, leading buy-side intelligence player that will provide unique products and analytics to meet the growing demand for an end-to-end platform. Axioma, a global provider of cloud-based portfolio and risk management software solutions, and Deutsche Börse's index business are highly complementary and together are expected to dramatically increase synergies, reduce to cost to customers and the companies, and improve the services offered by STOXX and DAX.
Theodor Weimer, CEO of Deutsche Börse, said, "This transaction is a step change for our pre-trading business and fully in line with our Roadmap 2020 strategy, which besides organic growth builds on programmatic M&A and new technologies. We are also excited about the partnership with General Atlantic and believe it will help to further accelerate growth of the combined business and to achieve strong value creation."
Sebastian Ceria, founder and CEO of Axioma, said, "The union of Axioma, STOXX and DAX under the Deutsche Börse umbrella creates a growth company that is uniquely equipped to help clients capitalize on the critical trends now reshaping the investment-management landscape. The combination of STOXX's indexing expertise with Axioma's best-of-breed analytical capabilities in risk management, portfolio construction and performance attribution is expected to result in strong near-term revenue synergies and creation of a platform for future growth."