UK-based TP ICAP has signed an agreement to acquire 100% stake in global electronic trading network Liquidnet, for a total consideration of between $575m and $700m.
The total consideration of the transaction includes cash consideration of $525m, subject to customary adjustments, paid during the closing of transaction, along with non-contingent deferred consideration of $50m and contingent consideration of up to $125m.
The acquisition is expected to create a new enlarged firm that will be a UK-based, global financial markets infrastructure provider. The transaction is anticipated to complete in the first quarter 2021.
Liquidnet is expected to benefit from the market structure and trends related to buyside objectives, including achieving trade process efficiency and best execution.
Also, the firm will advance the electronification of financial market trading across various asset classes and, in the dealer-to-client segments of the credit and rates markets.
Liquidnet acquisition to transform TP ICAP’s earnings profile
Liquidnet is a global electronic trading network, specialising in cash equities, dark or block trading. It has a growing fixed income presence, and an advanced data science capability within its investment analytics division.
The firm provides more than 1,000 buyside clients, who jointly manage $33 trillion in equity and fixed income assets, with to access to 45 markets across the world.
The acquisition is expected to transform TP ICAP’s earnings profile and growth trajectory.
In addition, it will enable the company to speed up the execution of its three pillar strategy of electronification, aggregation and diversification.
TP ICAP CEO Nicolas Breteau said: “Acquiring Liquidnet is a unique opportunity to transform TP ICAP’s growth prospects by materially accelerating the execution of our electronification, aggregation and diversification strategy. Liquidnet is a premier, technology-driven, global electronic trading network with more than 1,000 buyside clients.
“It has a strong and trusted brand, which we will both retain and develop. We will continue to invest in, and grow, Liquidnet’s leading dark/block Equities business, and maintain its position as a trusted and unconflicted agency broker.
“Liquidnet’s electronic network incorporates extensive buyside trade workflow connectivity, including integrations with all major order management and execution management systems.”
