First Derivatives has agreed a £36 million deal to acquire a further 46.47% stake in high performance database outfit Kx Systems, giving the firm a leg-up into the market for big data systems in capital markets and other vertical industries.
As a result First Derivatives’ holding in California-based Kx will increase from its current 20.1% to 65.2% on a fully diluted basis. First Derivatives has agreed a new five year loan facility of £24m with Bank of Ireland in order to finance the purchase.
As well as leading exchanges, regulators, and hedge funds Kx lists nine of the top ten global investment banks as customers for its flagship kdb+ database, and has recently signed major deals in other vertical markets, including oil and gas, pharmaceuticals and utilities.
Janet Lustgarten, CEO and co-founder of Kx Systems, comments: “We have been successfully focused on Wall Street for 20 years because of the large data sets they have. Now because the Internet of Things is generating large data sets in other industries we need to grow to be able to address these new opportunities. First Derivatives, with its deep pool of engineering talent and its global footprint is the ideal partner to help accelerate our growth, scale the company and to bring kdb+ to a wider audience.”
In its latest financial year to 31 December 2013, Kx reported revenues of $13.6m and profit before tax of $8.8m. The net assets of Kx at 31 December 2013 were $3.2m.
Brian Conlon, First Derivatives CEO, comments: "We intend to make significant investments in Kx to allow the founders and their team to scale the company whilst staying true to its heritage. Transformational is a term often overused in the technology industry, but in this case I can confidently use it to describe the impact this transaction will have on our collective prospects."