Seismic Shifts in the Exchange Landscape

Fintech Disruption

Mar 14, 2016

Seismic Shifts in the Exchange Landscape

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It’s an interesting time to be in the business of facilitating m&a in the fintech space. Last week, my partner Jason Panzer wrote a blog post on the ongoing effort by fintech companies to help financial services firms lower costs and improve quality by taking humans out of structured and unstructured processes. One fully intended consequence of this movement has been downward pressure on transaction prices. That’s good for the users – not always so good for the service providers. It’s disruptive.

We’ve been watching one manifestation of this trend as companies use technology to materially reduce the cost of affecting transactions in the securities markets. This trend has been driving per-trade costs dramatically lower around the world – and that has been causing seismic shifts in the landscape.

Two weeks ago, we heard that Deutsche Börse is in talks to merge with the London Stock Exchange unless, as we heard a week later, I.C.E. which bought the NYSE in 2013, gets in the way and launches its own bid for the LSE. Wednesday, we heard about NASDAQ, which bought CHI-X Canada in December, is now buying the International Securities Exchange from Deutsche Börse. Meanwhile, I.C.E. is selling its stake in the Options Clearing Corporation to NASDAQ. There’s a lot more going on in this space than we have time to write about. It’s fun to watch.

In other important news, we found out last week that Marlin & Associates has been nominated and named a finalist for Boutique Investment Bank of the Year and that I was named as a finalist for M&A Dealmaker of the year. It’s always an honor to be recognized by our peers. But our greatest joy is helping clients achieve their goals.

This month’s M&A Fintech Update is intended to bring a focus to the M&A values and trends in the seven discreet sectors of the fintech industry that we have followed and sometimes led for more than 14 years. Here are a few notable recent transactions:

  • TSYS (NYSE:TSS) agreed to acquire TransFirst from Vista Equity Partners for $2.4bn in cash, valuing the company at an implied 13.8x adjusted EBITDA;
  • Insight Venture Partners (New York, NY) agreed to acquire Diligent for $4.90 per share, valuing the company at approximately $624mm, including cash;
  • Nasdaq (NASDAQ:NDAQ) agreed to acquire Marketwired from OMERS Private Equity for CAD150mm (~$111mm);
  • BI-Sam acquired FinAnalytica; and
  • Wirecard acquired Provus Service Provider from Innova Capital for EUR 32mm (~$35mm) in cash.

Read the full M&A Fintech Update HERE.

We are here to advise the participants in this industry as they seek to buy, sell, or raise capital. Please let us know how we can help you.

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