July 30 (Reuters) – Intercontinental Exchange said on Thursday it will acquire bond trading platform MarketAxess Holdings in a deal valued at $5.7 billion to expand fixed-income offerings.
ICE shares were up 1.7% before the bell, after it also reported higher quarterly profit, boosted by trading activity.
Under the terms of the acquisition, ICE will buy all outstanding shares of the trading platform for $167 each in cash, the exchange operator said, which is a 33% premium to its previous closing price.
MarketAxess shares jumped 28% premarket, after having lost nearly 31% this year.
ICE said the combined entity will offer a single platform for fixed-income traders, combining pre-trade price analytics, electronic execution and post-trade compliance tools.
“Together, we will build the fixed-income ecosystem that investors have always deserved – one that is transparent, efficient, fully connected, and accessible to all,” ICE CEO Jeff Sprecher said in a statement.
ROBUST RESULTS
ICE’s results were boosted by volatility from the U.S.-Iran war and shifting interest rate and AI expectations, as investors hedged.
Prolonged conflicts in Ukraine and the Middle East also drove oil-market volatility, fueling growth in ICE’s energy segment, though the second quarter saw a 13% revenue drop in the segment.
That hedging pushed interest rates average daily volume up 24% year over year, while agriculture and metals volumes rose 36%.
In the quarter, revenue in its exchanges segment, its biggest revenue generator, rose 3% to $1.46 billion.
The fixed-income and data services segment, through which it sells subscription-based pricing data for certain debt assets, posted an 8% jump in revenue. Mortgage technology revenue was up 5%.
“Against a backdrop of rapid change in global markets, our customers continued to turn to ICE’s regulated markets, trusted data and mission-critical technology to transfer risk,” Sprecher said.
Net income attributable to ICE came in at $958 million, or $1.69 per share, in the three months ended June 30, compared with $851 million, or $1.48 per share, in the year earlier.
(Reporting by Pritam Biswas in Bengaluru; Editing by Joyjeet Das and Vijay Kishore)
