Markit Confirms Purchase of Storm’s “Technology Assets”
February 15, 2010
Markit, the data, valuations and processing firm for over-the-counter derivatives, has officially announced that it purchased the “technology assets” of Storm Networks, a developer of technology for trading syndicated loans.
In a statement issued at about 3 p.m. on Monday, Markit confirmed the details of the deal published in an article on www.securitiesindustry.com earlier today.
Markit also said that it has agreed to license software and technology from Quartet Financial Systems (QFS), which provided Storm with its technology. Terms of the deal with Storm were not disclosed and Markit officials were not available for further immediate comment.
The takeover of Storm marks the second acquisition for Markit in the syndicated loans arena in about a month. Last month, it completed the purchase of Storm’s rival ClearPar from Fidelity Information Services of Jacksonville Fla.
The Hawthorne, NY-based Storm Networks was founded in 2006 but never had any live customers. Markit bought the Valley Cottage, NY-based ClearPar, launched in June 2000, from Fidelity Information Services.
Founded in June 2000, ClearPar is widely considered the largest automated syndicated loan operations platform, competing with Trade Settlement Inc., in New York. ClearPar and TSI, also established in June 2000, allow buyers and sellers to electronically transmit information on the terms of syndicated loan deals with each other rather than doing so via paper documents – a more costly and time-consuming process.
In a November 2008 interview with Securities Industry News, Jay Katz, Storm’s managing director said that Storm’s platform, called Storm Loan, would provide more functionality than ClearPar. Storm Loan, Katz said, would pull data directly from the trading counterparties’ accounting systems replacing the need for human intervention to generate and confirm trade loan documents. Katz, a former chief information officer for ClearPar, helped create Storm and owns a stake in Storm. So do Bank of America Corp., Credit Suisse and Morgan Stanley.
“We have invested significantly in our loans business and the combined acquisitions of Storm and ClearPar allow us to support existing trade processing infrastructure while transitioning the market to an electronic settlement model,” said Armins Rusis, executive vice president and global co-head of fixed income at Markit in its statement issued today. “The ultimate solution which includes Markit’s loan data, messaging and identifiers will increase efficiency and transparency which in turn will promote liquidity, ushering in a new investor class.”
