Omgeo has acquired London-based collateral management house Allustra, for an undisclosed sum. In addition, the post-trade processor has acquired a derivatives portfolio reconciliation platform designed by Global Electronic Markets (GEM), after piloting the technology with a large broker/dealer and global hedge fund.
Omgeo says the union of GEM's derivatives reconciliation capabilities with Allustra's collateral management smarts, will set a new benchmark for OTC derivatives processing.
Marianne Brown, president and CEO of Omgeo, says the acquisition will enable the firm to expand beyond its traditional stronghold in matching and allocations and provide a more rounded portfolio for managing operational risk in the back office. The new suite of services will automate processes that are predominantly manual, she says, including reconciliation and dispute management, margin calculations, collateral inventory management and the collateralisation process with counterparties.
"There is an urgent need for a standard, automated process for investment managers to reconcile derivative positions and confirm the movement of collateral," says John Devine, COO of Threadneedle Asset Management and a member of Omgeo's board of managers. "The market sees Omgeo as the logical provider of a solution that combines both derivatives reconciliation and collateral management, as they truly understand the operational pain-points of the financial community."