Clearwater to purchase software program maker Enfusion for $1.5 billion in growth push

By Arasu Kannagi Basil and Niket Nishant

(Reuters) -Clearwater Analytics has agreed to amass Enfusion in a $1.5 billion cash-and-stock deal because the monetary software program maker seems to be to bolster its worldwide presence and enter the hedge fund trade.

Enfusion shareholders will obtain $5.85 in money and $5.40 in Clearwater inventory for every share, valuing the Chicago-based agency at $11.25 per share, the businesses mentioned on Monday. Enfusion shares closed almost 9% greater.

The deal highlights the attraction of mergers amongst firms that provide complementary companies and exhibits how they’ll acquire market share by means of strategic alliances.

“Every part that we do is after the commerce. And what Enfusion is concentrated on is every part earlier than the commerce. We’re very, very complementary,” mentioned Clearwater CEO Sandeep Sahai.

“Our shoppers want order administration programs and portfolio administration programs. We might construct it, but it surely’d have taken us a very long time to do it.”

Enfusion, primarily serving hedge funds, supplies portfolio administration and danger programs to funding funds, and expects a income of $201 million to $202 million in 2024.

Clearwater is providing a 32% premium to Enfusion inventory’s shut on Sep. 19 when Reuters had completely reported that it was exploring choices together with a sale after receiving takeover curiosity from potential suitors, together with personal fairness corporations.

The corporate had additionally fielded acquisition curiosity in 2023 from a number of potential acquirers, together with Francisco Companions, Vista Fairness Companions and Irenic Capital Administration.

Sure shareholders affiliated with funding corporations FTV Administration Firm and ICONIQ Development and Enfusion CEO Oleg Movchan, who collectively maintain about 45% of voting energy, have agreed to help the deal.

J.P. Morgan Securities and Kirkland & Ellis suggested Clearwater Analytics, whereas Goldman Sachs and Dechert suggested Enfusion’s particular committee. Goodwin Procter suggested Enfusion.

The deal is anticipated to shut within the second quarter of 2025.