IHS Markit Announces Intent to Acquire Ipreo, a Leading Software Solutions and Data Provider in Global Capital Markets
IHS Markit Announces Acquisition of Ipreo and Intent to Divest MarkitSERV - Supplemental Materials - Click here for PDF
Combination will extend IHS Markit workflow products and put company
at center of large and rapidly growing alternatives sector
Increases organic revenue growth profile of the company
IHS Markit also announces plans to sell MarkitSERV, its derivatives
LONDON--(BUSINESS WIRE)--May 21, 2018--
Markit (Nasdaq: INFO), a world leader in critical information,
analytics and solutions, has signed a definitive agreement to acquire Ipreo,
a leading financial services solutions and data provider, for $1.855
billion from private equity funds managed by Blackstone and the Goldman
Sachs Merchant Banking Division.
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The acquisition is expected to close in the second half of 2018, subject
to customary closing conditions and regulatory filings and approvals,
including with the UK Financial Conduct Authority and under the U.S.
Hart-Scott-Rodino Antitrust Improvements Act of 1976.
IHS Markit also announced today that, following a detailed review of its
financial services businesses as part of a disciplined capital
allocation strategy, it has initiated a process to sell MarkitSERV, its
derivatives processing business. MarkitSERV is a leading provider of
end-to-end trade processing and workflow solutions across OTC
derivatives asset classes.
Uggla, chairman and CEO of IHS Markit, said the Ipreo acquisition
represents an exciting opportunity to acquire a fast-growing financial
services company with highly complementary business lines.
"Ipreo has an extremely strong brand in financial markets and its
services are a logical and highly complementary extension to our
financial services business and our customer base," Uggla said. "Across
multiple product lines, we will deliver a more comprehensive service
that will allow clients to streamline their workflow and make quicker
and better decisions. We are excited to expand our footprint in the
rapidly growing alternatives sector."
"This marks the coming together of two strong organizations for the
greater benefit of all of our clients," said Scott Ganeles, CEO of
Ipreo. "IHS Markit will be a tremendous partner as we continue to build
on our position as a leading provider to global capital markets
Ipreo supports all participants in the capital-raising process,
including banks, public and private companies, institutional and
individual investors as well as research, asset management and wealth
management firms. Ipreo products and services minimize the increasing
costs and complexities of capital markets and offer solutions to the
high demand for regulation and compliance, industry cost pressures and
steep costs associated with building and maintaining in-house systems.
Based in New York City, Ipreo currently employs more than 1,700 people.
"Ipreo is well known as best in class in their product and service
offerings. By uniting Ipreo's strong teams and business with IHS Markit,
we will deliver even more to our client bases including new and
innovative combined solutions. The way our respective businesses
complement one another is quite extraordinary," said Adam
Kansler, president of financial services for IHS Markit.
Kevin Marcus, president and COO of Ipreo, said, "IHS Markit is a great
fit for us – in culture, market approach and focus on customer service –
and is a great home for us to continue our trajectory of success. We're
excited to leverage the collective talent of our organizations to
continue to bring leading-edge solutions to market."
"As a customer of both IHS Markit and Ipreo, we are excited by this
combination and the potential for further integrated services," said
Sumit Rajpal, managing director at Goldman Sachs.
Martin Brand, a senior managing director at Blackstone, said, "Since we
invested in Ipreo, the company has been able to deliver rapid innovation
and revenue growth, leading to substantial shareholder value
creation. IHS Markit will be a synergistic partner for Ipreo, with a
strong management team we have known for a long time. We look forward to
continuing to work with IHS Markit to explore opportunities to partner
in financial technology."
The Ipreo purchase price of $1.855 billion represents an effective 2019
forward Adjusted EBITDA multiple of 16x. After adjusting for a tax
step-up, the effective multiple is 15x. This high-growth business is
expected to achieve double-digit organic growth in 2019, and be
accretive to 2019 Adjusted EPS.
IHS Markit has received committed debt financing for the acquisition.
IHS Markit's expected leverage ratio as defined in its credit facility
is expected to be approximately 3.6x at close, delevering to below 3.0x
by third quarter 2019. IHS Markit will suspend its share repurchase
program until leverage returns to its targeted 2-3x leverage range.
Barclays is acting as lead financial advisor and HSBC is acting as
financial advisor to IHS Markit for its acquisition of Ipreo. HSBC will
act as sole lead arranger and book runner for the committed debt
financing for the acquisition of Ipreo. Davis Polk & Wardwell LLP is
acting as IHS Markit's legal advisor.
Conference Call and Webcast
A conference call and webcast with IHS Markit leadership to discuss the
acquisition of Ipreo, as well as plans to divest MarkitSERV, will be
conducted Monday, May 21, 2018, at 8:00 a.m. Eastern time.
To join the live event by phone, call toll-free (877) 309-2923.
Conference ID: 9279541.
To join the webcast, visit the IHS Markit website at http://investor.ihsmarkit.com and
log on at least 15 minutes prior to the start of the webcast. A replay
of the webcast will be available approximately two hours after the
conclusion of the live event. To access the webcast recording, visit http://investor.ihsmarkit.com.
The webcast recording will be available on this IHS Markit investor
website for one year.
Supplemental materials regarding the transactions will be posted to the
IHS Markit website at http://investor.ihsmarkit.com at
least one hour in advance of the conference call and webcast.
About IHS Markit (www.ihsmarkit.com)
IHS Markit (Nasdaq: INFO) is a world leader in critical information,
analytics and solutions for the major industries and markets that drive
economies worldwide. The company delivers next-generation information,
analytics and solutions to customers in business, finance and
government, improving their operational efficiency and providing deep
insights that lead to well-informed, confident decisions. IHS Markit has
more than 50,000 business and government customers, including 80 percent
of the Fortune Global 500 and the world's leading financial
institutions. Headquartered in London, IHS Markit is committed to
sustainable, profitable growth.
IHS Markit is a registered trademark of IHS Markit Ltd. and/or its
affiliates. All other company and product names may be trademarks of
their respective owners © 2018 IHS Markit Ltd. All rights reserved.
About Ipreo (www.ipreo.com)
Ipreo powers the networks that connect capital to ideas. We are a
leading global provider of financial services technology, data and
analytics, supporting all participants in the capital-raising process,
including banks, public and private companies, institutional and
individual investors, as well as research, asset management and wealth
management firms. Our unique, cross-asset class solutions equip our
clients with the information and tools they need for more effective
decision-making and a more efficient workflow. Ipreo serves clients in
every major financial hub around the world.
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Source: IHS Markit
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