Tuesday 23 July 2019

First Derivatives buys €36m majority stake in Kx

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stock markets
Gavin McLoughlin

Gavin McLoughlin

Newry-based financial software firm First Derivatives has acquired a majority shareholding in big data analytics company Kx Systems for £36m (€44m).

The firm said the move would allow it to push its software into other markets.

"Kx Systems have an existing presence in sectors such as oil and gas, pharma, utilities. And I suppose that allows First Derivatives to capitalise on these new market segments through the deployment of our new applications," First Derivatives chief operating officer Adrian Toner told the Irish Independent.

Kx reported revenues of $13.6m (€10.6m) and profit before tax of $8.8m (€6.9m) in its latest financial year.

The Palo Alto-based firm supplies technology to exchanges, regulators, hedge funds, and investment banks.

Finance for the deal came partly from a new five-year loan that First Derivatives has agreed with Bank of Ireland.

First Derivatives made headlines earlier this month after signing a deal to provide surveillance technology to IEX Group, the upstart US share-trading venture made famous in Michael Lewis's latest book 'Flash Boys' for taking on Wall Street giants.

IEX introduced "speed bump" technology that delays electronic trading by tiny fractions of a second in order to block so called "front-running," the controversial ability of big banks to profit by leap-frogging smaller investors' online trades.

"IEX was an attempt to remove those anomalies and make it a level playing field for all concerned, so obviously the fact that it's chosen our software to help them in that crusade is a bit of a coup for us," First Derivatives chief executive Brian Conlon told the Irish Independent after the deal was signed.

Irish Independent

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