Market data vendor Markit Group has acquired Communicator, a New York-based provider of automated systems for OTC derivatives trade processing. Financial terms of the deal were not disclosed.
The acquisition brings together Markit's pricing data and valuations in credit, equity, OTC derivatives and structured finance with Communicator's automated trade processing systems.
Founded in 1999, Communicator also provides secure communications and compliance and counterparty management services as well as identity management and information hub technology which drives the bond research platform, Bond.Hub.
The combined group will employ more than 200 people.
Lance Uggla, CEO of Markit, says the merger will bring together complementary services which will reduce risk and improve efficiency for dealers and asset managers.
"By joining forces with Communicator, we can provide our clients more effectively with a wealth of aggregated information and pricing," says Uggla. "The companies' combined services will allow us to offer clients the highest quality data coupled with leading technology, all on a single platform."
Regulators have been increasingly concerned about rising transaction volumes in the OTC derivatives markets and dealers have been ordered to clear settlement backlogs and tighten risk management procedures.
Leo Schlinkert, president and CEO of Communicator, who will join Markit's executive team, says: "The challenges that lie ahead in the shape of rising transaction volumes in the OTC derivatives markets will continue to test the industry's operational processes, and attract regulatory concern
"The combination of Markit's pricing and valuation services with Communicator’s OTC derivatives post-trade platform meets these challenges by offering an end-to-end service including trade confirmation, pricing, valuation and trade lifecycle events."
The two companies have an overlapping client base in the dealer community - Markit is part-owned by a group of 13 banks - but share few clients on the buyside, where Markit's base among hedge funds complements Communicator's traditional asset management list.