Deutsche Börse buys SimCorp for €3.9bn

Deutsche Börse, the German exchange operator, has made a bid to acquire SimCorp in a deal worth €3.9bn. The offer represents a 38.9% premium on the closing price of DKK529.0, and a 45.3% premium on the three-months volume-weighted average price of DKK505.7 as of 26 April 2023. The deal will be financed by cash and debt, and Deutsche Börse will pay DKK735.0 ($109) per share. SimCorp’s board of directors has recommended that shareholders accept the offer.

SimCorp offers scalable investment management SaaS (Software-as-a-Service) and BPaaS (Business-Process-as-a-Service) solutions. Deutsche Börse intends to group the firm with its existing data and analytics subsidiaries, Qontigo and ISS, under a newly created investment management solutions segment. The combined segment will generate upselling and cross-selling opportunities, as well as strengthening Deutsche Börse’s ESG offering.

The investment management solutions segment is expected to produce total annual run rate EBITDA synergies of around €90m within three years of the deal. Of these synergies, around €55m will be cost synergies and around €35m will be revenue synergies, with a one-off cost to achieve these synergies of around €100m. Deutsche Börse CEO, Theodor Weimer, said that the firm has been focusing on developing its investment management business, and that SimCorp is a perfect fit both culturally and strategically.

SimCorp is one of the leading global investment management software providers, serving the largest asset managers and asset owners worldwide. The acquisition is expected to strengthen Deutsche Börse’s position in the market, with the newly created investment management solutions segment able to provide asset managers with the technological infrastructure necessary to grow and expand their businesses.