Summary

  • Broadridge Financial Solutions, Inc. recently broke the news about inking a definitive agreement to buy Itiviti Holding AB (“Itiviti”).
  • Itiviti Holding AB (“Itiviti”) is involved in offering trading and connectivity technology to the capital markets industry.
  • Broadridge plans to acquire the firm in an all-cash deal worth EUR 2.143 billion (nearly USD 2.5 billion) from Nordic Capital.
  • The acquisition is subject to customary closing conditions and regulatory approval and is predicted to close in the fourth quarter of Fiscal Year 2021.

Idea behind the acquisition from the expert

Tim Gokey, Broadridge’s Chief Executive Officer, said, “The acquisition of Itiviti enhances Broadridge’s position as a global Fintech leader.”

He added, “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.”

Gokey said, “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 position us well to deliver at the higher end of our three-year growth objectives for recurring revenue and Adjusted EPS growth.”

Why Itiviti?

Itiviti is a leading name in the global capital markets technology provider segment that offers highly scalable solutions deployed by financial institutions to consolidate their trading infra, enabling significant cost savings.

With offices spread across 16 countries, Itiviti caters to 24 of the top 25 global investment banks and more than 2,000 leading brokers, asset managers, and trading firms across 50 countries.

The Trading and Connect solutions suite by Itiviti offers robust tools to aid connectivity and adaptivity to change market dynamics and regulatory demands. Additionally, the solutions and services offered give financial institutions the flexibility and functionality to cater to any trading style across asset classes.

Itiviti CEO Rob Mackay stated, “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.”

Value for clients

With a dedicated focus on front-office trade order and execution management systems, FIX connectivity and network offerings, Itiviti becomes highly suitable to Broadridge’s post-trade product suite and other capital markets capabilities.

This union works on a positive note to drive noteworthy value to clients by allowing them to simplify their front-to-back tech stacks, reducing risk, increasing efficiencies, and enhanced balance sheet utilization across equities, fixed income, and other asset classes.

As per Fredrik Näslund, Partner at Nordic Capital Advisers, “Itiviti has experienced a journey of growth and transformation during Nordic Capital’s ownership to become a world leading capital markets technology and infrastructure provider.”

He added, “We are immensely proud of the Itiviti team and it’s now time for them to take the next step with Broadridge, who is the ideal company to help capitalize on its next-generation technology platform and achieve even further growth and expansion.”