Trading technology firm Nyfix has signed a binding agreement to acquire 100% of Renaissance Trading Technologies, a start-up supplier of order-routing and execution workstations for Nasdaq stocks.
Nyfix, previously an 18% owner of Renaissance, will finance the transaction by exercising its option to convert a $1.5 million promissory note for 32% additional equity and acquiring the remaining 50% equity in Renaissance with a mix of stock and cash for approximately $6 million. The transaction is expected to close later this month.
Originally developed as an internal project at investment bank Robertson Stephens, the Renaissance Workstation products enable principal and agency traders to electronically receive orders in Nasdaq stocks from multiple sources, execute orders according to best execution rules, route orders to Super Montage, ECN or ATS destinations, and manage risk.
Renaissance went into production with its first clients during the second quarter of this year and expects to implement additional clients during the second half.
Peter Kilbinger Hansen, chief executive officer of Nyfix, comments: "The acquisition of Renaissance is an important strategic step for Nyfix as we can now offer best-of-breed solutions for both the Listed and OTC markets. The ability to reach the OTC marketplace has significantly expanded our potential market."
The Renaissance quote management system and order routing technology has been integrated with Nyfix's listed trading platform, FIXTrader to deliver a combined OTC and listed trading platform, Nyfix Platinum.
Says Hansen: "There are several customers that have installed the Nyfix Platinum solution and are trading on the system daily. These users immediately benefited from the value of having a single view and full access to all the OTC and listed marketplaces. We have a strong sales pipeline."