UPDATE: Iress Buys Proquote Terminal Biz from LSE

The acquisitions, announced together, are worth £37.6 million ($58.3 million) however Iress declined to state the value of each deal.

While Iress already has a UK staff of close to 600, Matt Rady, group executive of global markets at Iress, says the vendor made the acquisition to boost its position in the capital markets space, where it currently has a relatively small presence. The vendor's growth strategy is focused on being "relevant" and investing in the markets it currently participates in, "we don't want to spread ourselves too thin by being in too many places and being a big player in global markets...we prefer to have appropriate size investments in core markets, and the UK is a core market for us," Rady adds.

The LSE bought Proquote for £10.9 million in January 2003, reversing its 1994 decision to exit the data vendor space when it sold the Topic terminal business to ICV (which was later bought by Thomson Financial).

Following the completion of the deal, which has been in discussion for close to nine months, the Proquote brand will be retained and the staff integrated. However, Rady says that from a product and technology perspective, the services will remain separate for the immediate future.

An LSE spokesperson says the sale of Proquote fits into a diversification strategy that has been ongoing at group for at least the last four years, as demonstrated by the way it has more recently begun breaking out its revenues. In the past, the spokesperson says, there was a greater focus on the capital markets side of the LSE's business─specifically, the listing and then the trading of equities, which has increasingly become a much smaller slice of the group's overall revenues─whereas the rest of its information services business has increased as a share of overall group revenue. With the acquisition of the Frank Russell Company in 2014, and before that, the purchase of the remaining 50 percent of index provider FTSE that it didn't already own, LSE is focusing more on the benchmarking and indexing side of the information services division, of which Proquote was not an essential component, he adds.

Iress consulted with Proquote's clients, and was told that its systems are highly valued, so Rady says the vendor's immediate plan is to continue investing in the existing technology, "to enable clients to continue using the products and services from Proquote that they have always used," he says.

While there will be opportunities further down the line for Iress to provide a broader range of services to clients and link the two systems, there is "no plan to streamline [them] over time; it's more about building appropriate integration links," Rady says. "For example, the Proquote trading platform will enable an integration for Iress clients to access to things like fund trading, bond trading and Retail Service Provider facilities unavailable to Iress' current clients.... Likewise, we think there are opportunities to build out in Iress to allow our clients to access more market data, because of the depth of market data that Proquote has in its region.... There are opportunities there, but enabling clients to continue to use the technology that is there is the preference."

Following the completion of the deal, LSE will remain a supporting partner of Proquote, which will see the exchange continue to provide data to Proquote, while Iress will maintain the technology in the exchange's datacenters. "From that perspective, there is a strong ongoing partnership in a variety of ways that will continue post-transaction," Rady says.