London Stock Exchange to Acquire Quantile for £274m

As part of LSEG, London-based Quantile will operate as a standalone entity within its Post Trade division.

London Stock Exchange Group (LSEG) will buy Quantile Group, a provider of portfolio optimisation services for financial markets, for £274 million. 

As part of LSEG, London-based Quantile will operate as a standalone entity within its Post Trade division, reporting to Daniel Maguire, LSEG’s Group Head of Post Trade. Quantile will continue to be led by its CEO and co-founder, Andrew Williams.

Maguire says the acquisition “significantly enhances LSEG’s multi-asset class customer offering across the transaction lifecycle by providing more sophisticated tools and infrastructure for customers to optimise their financial resources and drive greater operational efficiencies in OTC derivatives”.

Since its formation in 2015, Quantile has grown to over 80 employees, with offices also in New York and Amsterdam. In January 2021, it received $51 million (£38.4 million) in investment from Spectrum Equity.

Williams worked for 18 years at Morgan Stanley. While Quantile’s chairman Stephen O’Connor worked as a Senior Independent Director at LSEG for eight years and at Morgan Stanley for 24 years.

According to Quantile’s site, it has been live since 2017. Its interest rate compression service is powered by algorithms and backed by quantitative analytics.

Participants submit their data to Quantile directly or via AcadiaSoft and set their risk constraints. Quantile then runs its optimisation engine to generate a proposal containing a set of new market risk neutral trades. This optimisation proposal is validated and accepted by participants and new trades are executed, “reducing counterparty risk and the cost of funding IM [initial margin]”.

The company says it has eliminated over $200 trillion (£151 trillion) of gross notional across 16 currencies.

Quantile’s clients include “all of the G15 top tier global banks”, regional banks and other large institutional market participants. In October, Quantile announced the launch of its compression service at the Japan Securities Clearing Corporation.

The transaction is expected to close in 2022, subject to antitrust and other regulatory approvals.

Antony Peyton
Antony Peyton
Antony Peyton is the Editor of eWeek UK. He has 18 years' journalism and writing experience. His career has taken him to China, Japan and the UK - covering tech, fintech and business. Follow on Twitter @TonyFintech.
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