By Amy-Jo Crowley
LONDON, Oct 13 (Reuters) – The London Stock Exchange Group is in talks with private equity firm Permira to acquire Octus for about $3.5 billion, the London-listed group said Tuesday, confirming a Reuters report.
No final agreement has been reached and no transaction is guaranteed, LSEG said, adding that the New York-headquartered financial data group has a strong track record of double-digit revenue growth based on a high-retention subscription model.
LSEG shares, which had dipped more than 2% on the Reuters report earlier on Tuesday, extended losses to fall 4.7% by 1342 GMT.
“Octus’ coverage and solutions are highly complementary to LSEG’s existing fixed income data & analytics and private markets solutions,” LSEG said, adding that a deal would be immediately accretive to LSEG’s Data & Analytics and group revenue growth.
PERMIRA BOUGHT CONTROLLING STAKE IN OCTUS IN 2022
London-based Permira is working with advisers to evaluate interest in Octus, two people with knowledge of the situation said. Permira declined to comment.
The private equity firm, which has been planning a sale of Octus since last year, has also held talks with other potential buyers, one of the people said. It acquired a controlling stake in Octus at a valuation of $1.3 billion from Warburg Pincus in 2022.
Octus provides information on credit markets, with a focus on companies in financial distress, for banks and investors. It employs journalists, analysts and legal experts, using technology to scour regulatory and court filings.
A potential Octus transaction, if it went ahead, would mark a further uptick in dealmaking in the data analytics sector, despite a selloff in listed stocks earlier this year.
YipitData, backed by investors including Carlyle Group, is exploring a sale that could value the data analytics provider at more than $2.5 billion, while Vista Equity Partners is exploring a sale of private markets data provider Allvue.
LSEG has been under pressure to improve its performance from activist investor Elliott Management, which disclosed a stake in the exchange operator in February.
LSEG is the largest customer of Reuters, which provides news for its Workspace news and data platform and other products.
(Reporting by Amy-Jo Crowley in London; Additional reporting by Milana Vinn in New York and Tommy Reggiori Wilkes in London; Editing by Anousha Sakoui, Elisa Martinuzzi, Alexander Smith and Jan Harvey)
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