Shares in London Stock Exchange (LSEG) rose 1.2% to £66.06 following the announcement it would acquire trade and risk software firm Quantile for up to £274 million.

Quantile provides portfolio, margin and capital optimization services to banks, hedge funds and financial institutions trading derivatives. The transaction is being funded from existing cash resources and is expected to close in 2022, subject to regulatory approval.

GROWTH POTENTIAL

Founded in 2015, Quantile has grown to over 80 employees with offices in London, New York and Amsterdam. The firm's services reduce counterparty risk, margin and capital requirements for market participants trading OTC derivatives globally.

In January 2021, the company received $51 million in growth investment from Spectrum Equity, a growth equity firm focused on internet-enabled software and information services companies.

Quantile will continue to be led by its chief executive and co-founder Andrew Williams who believes there is still ‘immense capacity’ for the firm to help its clients maximise efficiency and better manage their risk, capital and funding requirements.

STRATEGIC RATIONALE

The addition of data and technology businesses such as Refinitiv and Quantile is part of the company's drive to give customers more reasons to put more of their trading through its exchanges.

Daniel Maguire, head of the firm's post-trade division, said the Quantile deal 'significantly enhances LSE's multi-asset class customer offering across the transaction lifecycle by providing more sophisticated tools and infrastructure for customers to optimise their financial resources and drive greater operational efficiencies in OTC derivatives.’

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Issue Date: 06 Dec 2021