In a market that has become highly competitive, financial services providers have to continually improve their offerings to remain within shouting distance of their competitors. Partnerships and acquisitions of other financial services firms are vital in ensuring that a trading platform has the best options for its customers.
MarketAxess Holdings Inc. has announced the acquisition of LiquidityEdge. The former is a digital trading platform which provides fixed income securities to its trading clients. The acquired firm specializes in the provision of a marketplace for digital US Treasuries.
MarketAxess acquired LiquidEdge in a deal worth $150 million. The amount will be split as $100 million in cash and MKTX stock worth $50 million. According to the statement released by MarketAxess, the stock deal is subject to standard transaction price adjustments.
With the sole aim of connecting traders, investors and other market participants to the US Treasury market, LiquidEdge was founded in 2015. The partnership with MarketAxess will result in the two firms being able to provide their clients with competitive rates and bring better trading capabilities to the MarketAxess trading platform.
The trading platform will remain one of the top firms in electronic trading through this acquisition said Chris Concannon, Chief Operating Officer and President of MarketAxess.
Speaking on what LiquidityEdge brings to the table, the Chief Executive Officer of the firm, Nichola Hunter, said that LiquidityEdge has grown over a few years since it was established to become one of the leading trading platforms for US Treasuries.
He added that the marketplace records daily trades of over $25 billion, and they offer a unique product compared to other trading platforms.
LiquidityEdge’s success has come through the provision of cutting edge liquidity management and innovating financial technology solutions. This is what led the firm to the partnership with MarketAxess, added Hunter. The CEO says that MarketAxess is a leader in the fixed income markets industry, and his firm is excited to partner with MarketAxess.
Growth and expansion of services
MarketAxess is committed to ensuring that its services are satisfactory to their customers. The firm announced that alongside their acquisition of LiquidEdge, they are also expanding their hedging capabilities.
This expansion will see the firm provide Treasury hedging for the credit products on its platform. The addition of these hedging capabilities is scheduled for the last quarter of the year, which is the same quarter in which the acquisition deal is expected to be completed.