Grygo is chief content officer for FTF
StatPro’s board of directors announced late last week that it had agreed to a takeover offer from Confluence via Bidco in an all-cash agreement of approximately £161.1 million ($201.3 million).
The deal will take the company private — apparently in an effort to give customers fuller product platforms via a combined company.
To recap, StatPro offers:
- The Revolution suite of performance measurement and software-as-a-service (SaaS) portfolio analytics, risk management and compliance solutions offered via an integrated cloud‐based platform;
- The Infovest integration and data management services, which include support for proprietary data warehouse, extract, transform and load (ETL) and reporting services, and regulatory post‐trade compliance;
- Source:StatPro, an evaluated bond pricing service that encompasses a global ETF valuation service (including constituents), a managed benchmark index service, and a high‐quality yield curve service; Source:StatPro also offers models for complex assets and proprietary Freedom Indexes together with analytics and asset classification data.
In particular, the agreement specifies that Bidco “will acquire the entire issued and to be issued ordinary share capital of StatPro,” according to official statements.
Bidco is described as “an English incorporated company formed within the group of (and under common control with) Confluence Technologies, Inc. … ultimately controlled by funds managed and advised by [private equity firm] TA Associates,” officials add. TA Associates is the majority owner of the Pittsburgh, Pa.-based Confluence.
The key terms of the deal specify that each StatPro shareholder will receive for each StatPro share held: 230 pence or £2.30 ($2.87) in cash. Ultimately, the acquisition values StatPro at approximately £161.1 million ($201.3 million) on a fully diluted basis.
Despite the terms of the takeover agreement, the transaction is leaving more than a few people working in the performance measurement field scratching their heads.
From the perspective of the boards of directors of both companies, though, there are “strong strategic reasons for combining the two groups with their complementary geographic reach and products, and that this combination has the potential to deliver benefits to customers and other stakeholders,” officials say.
In particular, the StatPro directors, after being advised by Panmure Gordon, “unanimously consider the terms of the acquisition to be fair and reasonable,” officials say. The StatPro board will recommend unanimously that StatPro shareholders vote for the agreement at the court meeting and the special resolution at the general meeting.
Yet as one industry observer notes, the takeover is “a continuance of consolidation in the performance measurement application space.”
“Historically, each functional area was using one system but now asset managers are looking for one platform for risk, performance measurement, compliance and GIPS to help create a consistent approach for the entire firm,” the observer says. “It shows the trend of the asset manager industry changing and asking more from their technology partners to help meet the ever-evolving client and regulator needs and wants.”
The key executives that are party to the acquisition underscore that need for more among clients.
“The combined entity will offer asset managers and fund administrators a more comprehensive range of support services and analytics on one platform,” says Rory Curran, non-executive chairman of StatPro, in a prepared statement.
“We expect that Confluence and StatPro’s unique blend of subject-matter expertise, global reach and cultural fit will create further value not only for their customers and partners around the globe, but also for the industry as a whole,” says Jonathan W. Meeks, a managing director at TA Associates and a member of the board of directors of Confluence, in a statement.
The agreement is “expected to become effective in the fourth quarter of 2019, subject to the satisfaction or (where applicable) waiver of the conditions,” according to StatPro. “The scheme will be governed by English law and will be subject to the jurisdiction of the courts of England.”
The deal will be “subject to the applicable requirements of the Code, the Panel, the rules of the London Stock Exchange and the AIM Rules,” officials add.
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