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Virginie’s Blog – Musical Chairs

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It seems that 2011 has been another year filled with management shakeups, M&A activity and high profile exits and entrances within the vendor and practitioner communities. EDM solution vendors and data vendors in particular seem to have engaged in an ongoing game of musical chairs, not least of which has been the continued reshuffling at the top of data giant Thomson Reuters (about which we have spent long hours debating the next logical move for the vendor).

Obviously, we’ve blogged at length about the departure of Devin Wenig over the summer and the widescale restructuring at Thomson Reuters that has seen a rise in the fortunes (and visibility) of the Enterprise division and the disbanding of the old Markets and Professional divisions (see my colleague Andrew’s comments on which here). But, given the comment made by CEO Tom Glocer last month that there will be some sort of ‘flattening’ of the vendor’s operational structure in the near future, it leaves us wondering what next? When the music starts again, who will be out of the door?

Moreover, the sale of Thomson Reuters’ Kondor business to US-based private equity outfit Vista Equity Partners is ongoing and there is a great deal of uncertainty about what the new organisation will look like. No financial details have been publicly disclosed, but it is thought to have paid around the US$600 million mark for the trade processing and risk management unit. Exactly which bits of the Thomson Reuters risk portfolio have been included in the sale, which is due to close at the end of January, is also currently unclear. However, the sale will certainly herald the departure of key Thomson Reuters staff at the helm of the Kondor unit.

On the subject of vendor M&A, it has been a while since we’ve heard anything about the sale of corporate actions and back office processing solution vendor SmartStream, which was originally due to announce its new potential buyer in July (see more on which from earlier this year here). Perhaps current owner the Dubai International Financial Centre (DIFC) is holding off until the market picks up again, or sale negotiations are taking longer than expected in the current economic climate? Whatever the case, we’ll be watching intently for any movement over the next few months.

Of course, the vendor community has not been short of other M&A activity in the meantime. At the start of the year, Misys finalised its acquisition of valuations and risk solution provider Sophis and a lot of integration work has been going on during the intervening months (see more on which here). More recently, IBM acquired Algorithmics with a view to tying together its data management offerings with the latter’s risk solution set (see more on which here). Broadridge has also recently bought risk solution vendor Paladyne Systems and over the summer, the London Stock Exchange (LSE) picked up the UK Financial Services Authority’s Transaction Reporting System (TRS) for £15 million (see more here).

On an individual employee level, there have been many entrances and exits over the last 10 months within the vendor and practitioner communities. Deutsche Bank seems to have done fairly well for itself in picking up key data management execs with customer data experience in the form of ex-Citi Geert Berlanger and ex-RBC Julia Sutton (see more on which here).

On the vendor side of things, there have been a whole range of entrances and exits at all of the key EDM solution vendors, Cadis, GoldenSource, Asset Control, Netik et al, over the last few months. Some have hired from other vendors in the EDM community, like the move of ex-Asset Control sales exec George Collier to rival Cadis or the hiring of ex-GoldenSource exec Brian Rooney by Netik, whereas others have hired from outside the direct competition but from the wider vendor community, like Asset Control’s hiring of ex-Microsoft exec Brooks Gibbins (more on which here).

The same can be said of the data vendor community, with Interactive Data’s recent appointment of ex-Aite analyst Fritz McCormick (more on which here) and EDI’s hiring of ex-StatPro exec David Malette.

And we don’t expect the musical chairs to end any time soon. With so many layoffs, restructurings and market repositioning on the cards, one can expect the vendor and practitioner community to continue on its circular route of reshuffling.

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