Toronto-based stock exchange TMX Group has agreed to acquire the remaining 78% of the common units of index and data provider, VettaFi Holdings, for $848 million.
Following the strategic investments TMX Group made in VettaFi is H1 2023 for 22% of the common units, the total amount to be paid for full ownership totals $1.03 billion.
“The acquisition of VettaFi will add a dynamic new component to our growing information business, with an exciting set of capabilities and a visionary, innovative team committed to client success,” said John McKenzie, chief executive of TMX Group.
“Moving forward, the addition of VettaFi increases the depth and value of data-driven insights we provide to clients, expands our digital expertise and enriches our industry-leading support for ETF issuers. From a strategic standpoint, this acquisition accelerates TMX’s long-term global expansion, and increases the proportion of revenue derived from our Global Solutions, Insights and Analytics division, and from recurring sources.”
VettaFi provides a suite of global indices through its index factory, ETF services including ETF trends and analytics, a global ETF database, and digital distribution.
It also offers asset managers a range of indexing and digital distribution solutions to scale their businesses.
“Early on in our relationship with TMX Group it became clear that not only did we have complementary products and solutions, but our companies also have complementary cultures rooted in like-minded values and ambitious vision,” said Leland Clemons, chief executive of VettaFi. “Together, we will make markets and each other better.”
VettaFi will be included in TMX’s Global Solutions, Insights and Analytics segment, with the transaction expected to be completed in January 2024, subject to customary closing conditions.
This acquisition and inclusion into TMX’s Global Solutions, Insights and Analytics segment follows the launch of a new platform by TMX Group in November, designed to optimise the trading of Canadian equities.
Comprised of two order books – Alpha-X and Alpha DRK – the new order types were designed to optimise trading execution by “dynamically adjusting” to market conditions, alongside enhancing natural order flow and limiting adverse selection that occurs in the market due to “natural speed advantages” in the trading ecosystem.