London-based Gresham Technologies is acquiring New York-based post-trade automation specialist Electra Information Systems, in a cash deal valued at up to $38.6 million. The acquisition, which follows Gresham’s purchase of Inforalgo Information Technology last summer, will boost Gresham’s physical presence in the US, double its customer numbers to over 270, and strengthen its cloud and delivery capabilities.
Under the purchase agreement, Gresham will pay $28.95 million upfront and up to $9.65million on a deferred basis, conditioned on meeting certain performance criteria. Electra is a clear fit: Gresham specialises in providing real-time solutions for data integrity and control, banking integration, and payments and cash management, through its Clareti suite of products; Electra provides solutions and services to improve efficiency and mitigate risk in post-trade processing, including reconciliation, data aggregation & transformation, trade settlement and client fee billing.
According to Ian Manocha, CEO at Gresham, there is little crossover in terms of clients. “Of those 270, only four are joint clients, and they’re not using equivalent products, they’re different use cases. That’s where the opportunity lies. Electra’s primary two offerings are their data aggregation service and their reconciliation service. We don’t offer a comparable data service, so it’s our intent to take that forward to all of our customers, because we think that’s a really valuable offering to the market.”
Manocha says that Electra will be integrated with Gresham’s Clareti platform over time, but in the short-to-medium term, it will be business-as-usual for Electra’s clients. “All of the richness in Electra’s UI that the buyside community know and love will stay, but ultimately it will run on our platform, which will provide a lot more scalability and flexibility for the future,” he says, “and at the product level, the Electra brand will remain.”
Electra’s clients will see significant benefits as a result of the acquisition, says Manocha. “There will be more R&D firepower to drive the innovation agenda, and a lot more resource for customers,” he says. “Electra has done a brilliant job of penetrating the North American market, but the company hasn’t put as much focus on growing internationally. And that’s something that we want to do by offering Electra solutions globally, leveraging our global consulting, our global services and our global support. And Electra’s sales and technical teams will be of enormous value as we expand our broader business in North America.”
The deal, which has been facilitated by N+1 Singer, is expected to complete on June 22.