MarketAxess is set to acquire Deutsche Boerse’s Regulatory Reporting Hub via Trax, its wholly-owned subsidiary in the Netherlands.
MarketAxess operates an electronic trading platform for fixed-income securities and provides market data and post-trade services for the global fixed-income markets.
It also hosts a joint solution with EquiLend for the Securities Financing Transactions Regulation (SFTR), along with its standalone UTI Portal, which caters to the regulation’s unique transaction identifier (UTI) requirement.
The Regulatory Reporting Hub, meanwhile, is a pan-European reporting and compliance platform that enables buy- and sell-side clients to meet their regulatory obligations and transparency requirements across multiple regulations, such as the second Markets in Financial Instruments Directive and the European Markets Infrastructure Regulation.
The hub was expected to offer reporting services for SFTR, but plans to do so were shelved last year after it was unable to drum-up enough business to make it worthwhile.
The German exchange still offers SFTR services via REGIS-TR, its separate trade repository, which is unaffected by the sale.
Within Deutsche Boerse, the long-term viability of the hub is understood to have been uncertain for some time, as exemplified by the last-minute scrapping of its SFTR offering, and the exchange has quietly been seeking a way to offload the business for most of this year, AST understands.
It is further understood that several potential buyers were in discussion with Deutsche Boerse during this period with the main attraction of the hub being access to its healthy list of clients in Europe, and Germany specifically.
“With this acquisition, we’re strengthening both our global post-trade and data businesses in two important ways: significantly extending our European client footprint, and increasing our ability to bring new, innovative technologies and solutions to a critical and complex part of the trade lifecycle,” said Christophe Roupie, MarketAxess’ head of Europe, the Middle East and Africa, and Asia Pacific.
In a statement on the deal, MarketAxess added that purchasing the hub will help to further expand and enhance its established services particularly in Germany, France and the Nordics.
The transaction is expected to close in Q4, subject to the satisfaction of customary closing conditions. The terms of the deal are not publically available.
The hub is being sold through Regulatory Services GmbH, a subsidiary of Deutsche Boerse Group and does not affect any other services provided by the German exchange.
Both MarketAxess and Deutsche Boerse are reassuring the hub’s customers that there will be a smooth service transition.
