Intercontinental Exchange To Buy Interactive Data For $5.2 Bln

(RTTNews) - Exchange operator Intercontinental Exchange Inc. (ICE) said Monday that it has agreed to acquire Interactive Data Corp. from private equity firms Silver Lake and Warburg Pincus LLC for about $5.2 billion in cash and stock. Interactive Data or IDC is a provider of financial market data, analytics and related trading solutions.

ICE, owner of the New York Stock Exchange, noted that the acquisition of Interactive Data will help build on ICE's market data business by expanding the markets served, adding technology platforms, and increasing new data and valuation services. The transaction is expected to close by year-end 2015.

Under the terms of the deal, IDC shareholders will receive consideration of $3.65 billion in cash and $1.55 million in ICE common shares.

The aggregate number of ICE common shares offered is 6.5 million shares, and up to 2.2 million additional ICE common shares based on a sliding scale from $179.07 to $238.76 per share.

Bedford, Massachusetts-based IDC serves the mutual fund, bank, asset management, hedge fund, securities and financial instrument processing and administration sectors. The company was acquired by Warburg Pincus and Silver Lake for about $3.4 billion in 2010.

The two private equity firms were reportedly exploring a sale of IDC as well as its initial public offering, known as a "dual-track" process. IDC had filed for an initial public offering earlier in October, but was also said to have received takeover interest from financial data firms.

Jeffrey Sprecher, ICE Chairman and CEO said, "With our diverse markets across virtually all asset classes, IDC will enable us to address more growth opportunities by leveraging the distribution and reach of our complementary global platforms for trading, clearing and data on a combined basis."

ICE noted that for the third quarter of 2015, IDC revenues are expected to be $238 million, while its adjusted EBITDA is projected to be $992 million. IDC's recurring revenue has exceeded 98 percent of total revenue in each of the years from 2011 to 2014.

ICE expects expense synergies of $150 million to be largely completed by the third year post-closing. The company also expects adjusted earnings accretion of about 5 percent in the first year post-closing, excluding deal-related amortization.

ICE is trading at $251.69, up $2.89 or 1.16 percent on a volume of 282,973 shares.