Goldman Sachs is in advanced talks with Trading Technologies International about acquiring the Chicago-based fintech firm for an estimated $500m (£370m), according to sources.
The US investment bank is said by four sources to be in late stage talks with TT about buying the trading and data analytics software firm but no agreement has been reached at this stage.
A spokeswoman for Trading Technologies said on Wednesday: “The TT platform is an industry-leading technology that unsurprisingly has captured the attention of a variety of industry players. Conversations with other firms about partnerships are nothing new, as we have always looked for ways to unlock additional value and share our vision for scaling the business.”
A spokesman for Goldman Sachs declined to comment.
The talks initially surprised brokers and traders in London who said a sale might spook Trading Technology’s many investment banking clients who would likely feel uncomfortable using trading software owned by one of their main rivals.
But the brokers said the tech firm is attractive to Goldman Sachs as the bank could use TT’s footprint at many of the world’s top trading firms to promote the bank’s diverse brokerage services.
TT’s trading, network and data analytics software could complement Goldman’s data and brokerage services to deliver a comprehensive trading platform to buy-side firms such as fund managers, hedge funds, proprietary traders and retail clients.
The talks are seen as the natural extension of the September 2019 agreement between Goldman Sachs and Trading Technologies to allow the bank to distribute the TT platform to Goldman clients.
A Barron’s news report said in October that Trading Technologies International was up for sale, citing four executives familiar with the matter, one of whom valued the deal at about $500m.
Founded in 1994, TT supplies software to most of the world’s investment banks, brokers and trading firms.
The Chicago-based firm cut its teeth with X-Trader, the derivatives traders’ platform of choice, but has in recent years moved into trading networks and analytics.
TT, led by chief executive Rick Lane since early 2014, has also diversified into crypto-currency trading and increased its links to Asia including China’s vast onshore derivatives markets.
Goldman Sachs bought REDIPlus in 2000 before expanding the equity trading system’s coverage to include derivatives and then rolling REDI out to its clients and inhouse brokers.
Goldman sold its majority interest in REDI to a consortium including some of its main investment banking rivals in 2013.
Dublin-based tech giant ION Group bought UK trading software firm Fidessa for £1.5 billion in early 2018.
Trading Technologies is partly-owned by The FSB Companies, a Chicago-based investment group founded and run by Frank Brumfield, a former derivatives trader.
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