After years of speculation, fund data provider Kneip has finally been sold to Deutsche Börse, the German exchange.
Rumours of a sale of the Luxembourg-based business were rife, especially after Neil Ward was brought in as chief executive in 2017. Mr Ward was seen by many as instrumental in the sale of tech communication company Skype to Microsoft in 2011 and was thought to be lining up a deal for Kneip when he arrived.
However, no deal came to fruition and the company brought in Enrique Sacau as chief executive in 2020. A year after Mr Sacau’s arrival, Kneip was in a partnership with Nasdaq Fund Network increasing the company’s already well-established European presence and perhaps in hindsight, making it more of attractive for a would be suitor.
Deutsche Börse has said it is expanding its data services offering with the purchase of 100 percent of the Grand Duchy-based fund data company.
No further details of the deal are currently available although it is expected to close by the end of this month (March).
Established in 1993, Kneip provides regulatory reporting solutions for the asset management industry. The company manages investor disclosure and data publication for more than 10,000 funds in over 40 countries, including the production of over 200,000 reporting solutions. Kneip currently services over 30 per cent of EU-based fund ISINs.
The deal might be considered in some ways similar to the London Stock Exchange’s move for market infrastructure and data provider Refinitiv, which pleased many fund managers such as Nick Train who saw the deal as immediately earnings accretive. This transaction did gain the attention of regulators however, although was completed last year in January.
The combination of Deutsche Börse and Kenip is hoped by the German exchange to create a leading fund data hub based in Luxembourg.
The company said Kneip will seek to further scale the business and expand its range of services inside Deutsche Börse Group, including data and post-trade services provided by Clearstream. Deutsche Börse also intends to connect Kneip’s services with its established fund services platforms.
Philippe Seyll, head of investment fund services at Deutsche Börse Group, said: “Through Kneip’s global reach and broad range of services, we will be able to further develop our product and service offerings and add value for funds clients at every stage of their business. This is also a unique opportunity to create a leading European fund data champion based in Luxembourg.”
Enrique Sacau, chief executive at Kneip, said: “Deutsche Börse’s scale and resources will broaden our portfolio and boost our ability to deliver more value to clients faster. I look forward to developing and growing Kneip as part of Deutsche Börse Group. Above all, I would like to thank Hugues Delcourt, Chairman, and Bob Kneip, Founder & Vice Chairman. Over the last two years, I have worked together with Hugues to transform Kneip. His wisdom and drive have been critical, as has been Bob’s support and trust.”
Acquisitions by exchanges are common although often fall foul of the regulators. For instance, the touted £21 billion merger of Deutsche Börse with the London Stock Exchange was blocked in 2017. The addition of data providers may be the way exchanges will choose to grow if recent history proves to be a mark for things to come.
