Deutsche Börse to acquire majority stake in Quantitative Brokers

German capital market company Deutsche Börse said that it will acquire a majority stake in Quantitative Brokers, a provider of advanced execution algorithms and data-driven analytics for global futures, options, and interest rate markets.

The financial terms of the deal were not disclosed.

Quantitative Brokers has operations in New York, London, Sydney, and Chennai. The fintech company is said to be a major player in market structure and is at the forefront of innovation in the market for intelligent, electronic execution services.

The company’s portfolio of algorithms, simulation tools, and analytics is claimed to be used by some of the largest institutional investors in the world.

Quantitative Brokers’ offering is said to cater to the growing demand for intelligent and transparent solutions to manage execution cost and performance through a broker-neutral workflow. Its algorithms are engineered for central limit order books and also OTC liquidity streams while accessible through all major execution and order management systems that are used by the buy side, banks and brokerage houses.

Deutsche Börse said that the deal will move it closer to the sources of trading interest in the buy side value chain, thereby contributing to the buy side focused growth initiatives of trading and clearing division.

Deutsche Börse to acquire majority stake in Quantitative Brokers. Photo courtesy of Deutsche Börse Group.

The German capital market company said that in the exchange traded derivatives segment, the transaction will help speed up buy side product adoption and order flow attraction.

Also, Quantitative Brokers’ quant team is expected to complement Deutsche Börse’s drive to grow its data and analytics services.

Thomas Book – Head of the Trading & Clearing Division of Deutsche Börse said: “We are investing in a growth business with a renowned, innovative and leading quant team delivering a unique set of competencies in algorithmic execution. The exciting QB platform and team are a perfect fit with both our existing business and our long-term strategic perspective.”

The fintech company will be majority owned by the German capital market company, with the founders to retain considerable portions of their shareholdings and to stay in their respective roles. Christian Hauff will remain as CEO and Robert Almgren will continue as Chief Scientist.

The 2020 revenues of Quantitative Brokers are estimated to be about $25 million.

Robert Almgren said: “Deutsche Börse’s global relationships with buy and sell side customers will help us add value to an even broader range of clients. Our intelligent solutions will provide them with additional tools to better manage order execution in an increasingly complex market environment.”

The deal is expected to be wrapped up by the end of this year subject to receipt of required regulatory approvals.