Broadridge Financial Solutions announced it has signed a definitive agreement to acquire Itiviti, a provider of trading and connectivity technology to the capital markets industry, in an all-cash transaction valued at €2.143 billion (approximately $2.5 billion) from Nordic Capital. It’s expected to close in Q4 2021.
Tim Gokey, Broadridge’s CEO, said in a statement: “By extending our capabilities into the front office and deepening our multi-asset class solutions, Itiviti significantly strengthens our Capital Markets franchise and better enables Broadridge to help financial institutions adapt to a rapidly evolving marketplace. Itiviti’s well-developed footprint in APAC and EMEA will increase our scale outside North America and strengthen our ability to serve our global clients.
“The acquisition is also expected to deliver value to our shareholders in the form of stronger recurring revenue growth, higher margins and higher Adjusted EPS. This incremental revenue and earnings growth positions us well to deliver at the higher end of our three-year growth objectives for recurring revenue and Adjusted EPS growth,” Gokey said in a statement.
Itiviti is a global capital markets technology service provider offering scalable solutions that financial institutions use to consolidate their trading infrastructure, driving significant cost savings. With offices in 16 countries, Itiviti serves 24 of the top 25 global investment banks and over 2,000 leading brokers, trading firms and asset managers across 50 countries. Its suite of Trading and Connect solutions offer comprehensive tools to support both connectivity and adaptivity to changing market dynamics and regulatory demands. The solutions and services offered provide financial institutions the flexibility and functionality to serve any trading style across asset classes.
Itiviti CEO Rob Mackay said in a statement: “Joining Broadridge represents an exciting next chapter for our business and team by creating a leading front-to-back capital markets technology and operations provider. The combination of our technology, solutions and people will unlock significant value for our clients and drive long-term growth for our combined business.”
The combination is expected to drive significant value to clients by enabling them to streamline their front-to-back technology stacks, increasing efficiencies, reducing risk and optimizing balance sheet utilization across equities, fixed income, exchange-traded derivatives, and other asset classes. With more than $900 million in combined calendar 2020 revenues, Broadridge’s Capital Markets franchise will be even better positioned to help its clients adapt to increasing electronification and algo-driven trading and to mutualize non-differentiating functions to reduce their total cost of ownership.
In addition, Itiviti’s strong presence in APAC and EMEA will significantly expand Broadridge’s revenues outside of North America and enhance Broadridge’s international footprint in key markets. Itiviti’s blue-chip client base should also provide significant cross-sell opportunities across Broadridge’s product portfolio, further enhancing its long-term growth.