An announcement is expected within weeks concerning the repositioning of CicadaRisk, provider of risk management solutions based on Algorithimics’ risk technology and Cicada’s data management technology. The objective is to enable CicadaRisk to operate more as an independent entity within the financial markets vertical of its principal financial backer Investors Guaranty.
CicadaRisk has operated as a joint venture between Algorithmics, Investors Guaranty and Cicada, but, according to an Investors Guaranty spokesperson, the goal was for it to eventually operate as an independent business.
She continues: “Cicada helped CicadaRisk in the initial stages with hands on management, technical and operations expertise. Its reference data management technology was integrated with Algorithmics’ risk management platform, and the Cicada technology will continue to be used. A team that includes founding members of Algorithmics has been transitioned over to manage day to day operations.” She confirms that the former CicadaRisk COO Richard Bennett – who came from Cicada – has left to pursue other interests.
Sources close to the company suggest that there has been friction in the relationship between Algorithmic and Cicada, with distribution of fees a key factor. In early October Algorithmics announced it had “re-aligned and expanded” its product development agreement with Investors Guaranty. The spokesperson says: “The renegotiated agreements between Algorithmics and Investors Guaranty as referred to in the October press release were not the result of any disagreement on fee distribution. The agreements simply provide an opportunity for the parties to inde-pendently pursue their own strategies for the buy side, from a sales, market-ing and product development perspec-tive (with no revenue share for sales).”