London Stock Exchange Group has agreed to acquire MillenniumIT, a Sri Lanka-based technology services company serving the capital markets industry, for $30 million.
Reportedly, the MillenniumIT’s technology will provide the London Stock Exchange Group with a low latency in-house developed trading system with multi-asset class functionality and quicker product speed to market. In addition, the transaction will give MillenniumIT the backing of the London Stock Exchange Group to enable it to develop its global exchange technology business.
The Group has said that it will begin migrating clients to MillenniumIT’s trading system from the end of 2010, replacing TradElect, Infolect, and other interfaces. The Group expects that the new platform will allow it to enrich its functionality, in particular for Italian clients, with the possibility of accommodating both trading after hours and stop loss orders.
London Stock Exchange Group has added that MillenniumIT will retain its commercial operations and continue serving its existing clients, with its CEO, Tony Weeresinghe, reporting directly to Xavier Rolet, chief executive of London Stock Exchange group.
Mr. Xavier said: “This transaction enables the Group to implement a new, more agile, innovative and efficient IT capability for our future business development as well as running a new cash trading platform which will provide substantially lower latency, significantly higher capacity and improved scalability. It will also offer cost saving opportunities in the future and give the Group a footprint in Asia. The potential from this transaction is considerable for both parties.”
Tony Weeresinghe, CEO of MillenniumIT, said: “This transaction with London Stock Exchange Group is a tribute to the innovative culture of our company, the quality of our technology solutions and our deep pool of talented staff. The Group’s backing gives us the resources to continue supporting our existing customers, expanding the company into other markets and investing for the future.”
David Lester, director of information and technology, London Stock Exchange Group, said: “MillenniumIT are a leader in developing low cost high performance trading platforms and financial markets software. Going forward, as well as serving existing and new clients, they will be the Group’s in-house software development team, gradually replacing our current suppliers and bringing intellectual property and know-how fully within the company. We look forward to introducing their proven trading platform before the end of 2010, which will provide our clients with sub-millisecond trading latencies and give the Group a very fast, multi-product, cost-efficient, scalable trading platform. The transition will be carefully managed, with further enhancements to TradElect planned in the interim.”
However, the transaction is expected to complete by mid October 2009, subject to satisfaction of all conditions to the offer and receipt of all necessary clearances.
