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A-Team Insight Blogs

Stop Press: General Atlantic Buys ‘Significant’ Stake in Bank-Owned Markit

Greenwich, Conn.-based private equity firm General Atlantic has acquired a “significant” minority stake in bank-owned pricing and valuations supplier Markit in return for a “substantial equity investment” in the company. While the size of the stake wasn’t disclosed, it’s significant enough to warrant a board seat for General Atlantic CEO Bill Ford.

The General Atlantic investment will be used “to assist Markit actively in developing its growth strategy further and executing value-creating acquisitions.”

Markit’s ownership structure has been subject to market speculation since the US Department of Justice investigation opened an investigation into its business practices last year, with observers wondering whether the probe may incite bank owners to distance themselves from the highly successful data vendor.

The investment appears to dilute the holdings of the group of financial institutions that owns Markit, which is believed to include investment banks Bank of America, Citigroup, Credit Suisse, Deutsche Bank, Dresdner Kleinwort/Commerzbank, Goldman Sachs, JP Morgan Chase, Morgan Stanley, Nomura, TD Securities, and UBS, as well as three buy-side firms.

It isn’t clear whether the sale to General Atlantic signals an appetite for further divestment for the group. Another major bank-operated entity, the Turquoise multilateral trading facility, has sold a 60% stake to the London Stock Exchange in a sign that banks may be seeking to reduce their investments in non-core business.

For its part, General Atlantic is a growth equity firm that combines a collaborative global approach with a long-term investment horizon. It manages approximately $15 billion in capital and has more than 75 investment professionals based in Greenwich, New York, Palo Alto, London, Duesseldorf, Hong Kong, Beijing, Mumbai and Sao Paulo.

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