The London Stock Exchange (LSE) has reportedly agreed to terms in order to acquire portfolio optimization platform Quantile, further extending its post-trade offerings to the over-the-counter (OTC) derivatives market.
Over the years, Quantile has managed to expand its team to more than 80 employees, with business offices present in London, New York and Amsterdam.
The company’s services aim to lower counterparty risk, notional, and capital requirements for market participants trading OTC derivatives internationally.
Customers include all of the G15 top-tier international banks, regional banks as well as other major institutional market participants.
In January of this year, the firm acquired $51 million in growth investment from Spectrum Equity.
As part of the LSEG, Quantile will be operating as a standalone business entity reporting to Daniel Maguire, who is LSEG’s Group Head of Post Trade.
Quantile’s management confirmed that they will continue to be led by their company CEO and co-founder, Andrew Williams.
Williams remarked:
“We have built Quantile to be a bold and agile company which can react quickly to our clients’ needs, and we will continue to operate this way, but with the expertise and platform of a larger group. Clients continue to face new challenges and there is immense capacity for Quantile to help maximize efficiency and better manage risk, capital and funding requirements through our multilateral optimization services.”
The transaction, which is expected to reach the £274 million mark, is set to be finalized in 2022.
LSEG explained on December 6, 2021, that it decided to acquire the Quantile Group in order to expand its range of post-trade risk management services.
Quantile is a provider of portfolio, margin, and capital optimization services for banking institutions, hedge funds, and financial institutions trading derivatives.
LSEG has committed to paying £274 million (appr. $362 million) to Quantile’s shareholders.
As reported by Reuters, the acquisition will operate as an independent entity within the firm’s post-trade business which offers clearing services for OTC derivatives.
Established in 2015, Quantile is being chaired by Stephen O’Connor, the ex- Morgan Stanley banking professional who used to be the head of the International Swaps and Derivatives Association.
Until August of this year, Stephen has been working as an independent director at the LSEG.
LSEG currently owns financial data, analytics provider Refinitiv, which branched out of Thomson Reuters.
