New York-based Investment Technology Group, a provider of technology-based trading services and transaction research, has agreed to acquire privately-held RedSky Financial, a Chicago-based
New York-based Investment Technology Group, a provider of technology-based trading services and transaction research, has agreed to acquire privately-held RedSky Financial, a Chicago-based broker-dealer specialising in electronic multi-asset class trading with an emphasis on exchange-traded equity derivative products.
RedSky’s advanced trading platform further diversifies ITG’s asset class capabilities. Its multi-asset trading platform, R3, facilitates high frequency trading for professional and institutional traders, and also offers routing for foreign exchange and fixed income trading.
ITG plans to integrate R3’s functionality into its existing execution management systems, Triton and Radical, to give clients consolidated access to all equities, equity options and futures. Triton currently supports equities and Radical supports equities and options.
‘The acquisition of RedSky provides ITG with an opportunity to add robust options and futures capabilities to our Triton and Radical front ends, as well as our algorithmic trading suite, creating versatile multi-asset execution management systems,’ said ITG chief executive and president Bob Gasser.
‘ITG has long said that its value proposition is based on providing clients with comprehensive trading solutions that span the trading continuum, and the acquisition of RedSky’s capabilities will further enhance ITG’s position as a leader in the industry.’
RedSky also offers direct access to multiple execution destinations and market data through application programming interfaces that gives high-frequency traders the lowest possible latency when submitting and processing orders, allowing them using their proprietary systems to connect directly to the markets via RedSky’s routing infrastructure.
Says RedSky chief executive Bob Fitzsimmons: ‘The integration of RedSky’s best-in-class futures and options trading technology into ITG’s existing sophisticated trading products will provide clients with the ability to efficiently trade multiple asset classes from a single trading application.’
The all-cash transaction is expected to close in the third quarter. The purchase price is approximately USD22m, plus contingent consideration based on future profitability.
ITG is a specialist agency brokerage and technology firm that partners with clients globally to provide solutions spanning the entire investment process, combining pre-trade analysis, order management, trade execution and post-trade evaluation to provide clients with improvements in trading and cost efficiency. The firm is based in New York with offices in North America, Europe and the Asia-Pacific region.
Founded in 2000, Chicago-based RedSky Financial is a broker-dealer and FCM specialising in electronic trading in multiple asset classes, providing professional traders, hedge funds, institutions and proprietary trading groups with direct access to stocks, options, futures, foreign exchange and bonds through its proprietary R3 trading platform. For algorithmic traders, RedSky offers multiple application programming interfaces for order submission and price subscription.