New Jersey-based Knight Capital Group is acquiring fixed income trading platform ValuBond in an all-cash deal worth $18.2 million.
Atlanta-based ValuBond provides an electronic trading platform and trader and broker workstations for fixed income securities, as well as advanced trading technologies and infrastructure through its wholly owned subsidiary, ValuBond Securities.
Knight says the acquisition expands its fee-based electronic access services into the fixed income asset class and ValuBond's broker-dealer client base also opens up cross-selling opportunities.
Thomas Joyce, chairman and CEO, Knight Capital Group, adds: "Fixed income is a vast and growing asset class still largely untouched by automation within the broker-dealer space. However, multi-asset class diversification and technology trends are fueling demands by investors for the same fast, efficient trade execution in fixed income that they have come to expect in the equities market. We believe our clients will increasingly want to provide electronic access to fixed income, from the same platform that they can access other asset classes like equities and foreign exchange."
The deal is expected to close within six months, pending regulatory approval. Upon closing ValuBond, which has 18 employees, will operate as a separate subsidiary of Knight.
Following the acquisition, John Pigott, chairman and CEO of ValuBond, will report to James Smyth, senior managing director and head of Knight's broker-dealer client group.