BETA+ offers back-office processing solutions to the wealth management industry, including securities processing and tax reporting services
London Stock Exchange. (Credit: jam_90s/ Flickr (Creative Commons))
London Stock Exchange Group (LSEG) has agreed to sell its BETA, Maxit and Digital Investor assets, collectively called BETA+, to affiliates of Clearlake Capital Group and Motive Partners for a total consideration of $1.1bn in cash.
BETA+ is engaged in providing back-office processing solutions to the wealth management industry, including securities processing and tax reporting services.
According to LSEG, BETA+ has generated revenues of around $300m last year, predominantly from the US markets.
The transaction is expected to close in the second half of this year, subject to satisfaction of certain customary conditions and certain customer consents.
LSEG group data and analytics head Andrea Remyn Stone said: “The divestment of BETA+ will focus LSEG’s Wealth business on meeting our customers’ needs in high growth areas. This includes the provision of data, analytics and workflow tools where we have deep capabilities and where LSEG is driving innovation.
“The partnership with BETA+ under its new owners offers a platform for further revenue growth in content and data while ensuring continuity for customers under a new owner focused on this segment of the market.”
LSEG said that the divestment, together with strong ongoing cash generation, would de-lever the group towards the middle of its leverage range.
The firm intends to return a significant proportion of the net proceeds from the transaction to its shareholders, through a buyback expected to start in Q3 this year.
In addition to the sale, LSEG has entered into a new long-term partnership with BETA+ and portfolio companies of Motive and Clearlake for data, content and tools support.
The new partnership is anticipated to provide LSEG with access to new client segments, facilitating new and recurring revenues at high growth rates.
With the divestment of BETA+ and the new strategic partnership, LSEG is enabled to strengthen the growth of the Wealth segment in its Data and Analytics business.
Clearlake co-founder and managing partner Behdad Eghbali said: “BETA+ has established a strong position in the self-clearing technology space and broader wealth management ecosystem with a reputation for meeting the unique needs of global financial institutions and their clients.”
Motive Partners co-founder and industry partner Stephen Daffron said: “BETA+ will be focused on creating frictionless, digital-first experiences for clients, advisors, and home office personnel with streamlined processes, reduced costs, and increased retention and satisfaction.”