Forefront Communications

WatersTechnology: Confluence & StatPro: A Sign of the Buy-Side Times


Forefront Communications

Forefront Communications

These days, the buy side has no shortage of obstacles. Margins are tightening, costs are rising, regulations are hitting, and investor preferences are changing. Simply put, it’s a rapidly changing world for asset management. Then there are the vendors—and maybe there’s too many of them.

Rumors had been swirling for the last four-or-so months that StatPro, the cloud-based UK firm that offers portfolio analytics through its SaaS-delivered tools, was up for sale. On Oct. 29, those rumors became reality: Confluence Technologies, a US-based provider of automation software for investment managers, announced its acquisition of StatPro for £161.1 million (more than $207 million) in cash. Backed by private equity firm TA Associates, Confluence will take the London Stock Exchange-listed StatPro private.

According to some sources, this deal came as a bit of a surprise. While StatPro was known to be on the auction block, the speculation was that it would be a State Street, JP Morgan, Northern Trust or one of the other larger banks that have alternative investment services to add the performance analytics specialist to their portfolio. Confluence, though, made for a natural fit thanks to their US-focused risk and regulatory suite of solutions, and their desire to expand into Europe.

Alleviating some of the buy side’s pain points, and allowing their now-combined client base to focus on innovation, are the rationales for the deal, Mark Evans, CEO of Confluence, tells WatersTechnology.

“We approached each other, more or less. We’ve been talking forever,” Evans says of the two companies. “It just became absolutely, glaringly obvious that we should be joined. It’s all about data at the end of the day; that’s our view. They have a great creation and curation in the front and middle office, and we have great curation and delivery in the back office. It was just one of those the-time-is-right things.”

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