Greenline Financial Technologies, Inc. is an industry innovator specializing in the development of customized integration, testing and management solutions for Financial Information Exchange (âFIXâ)-related products and services designed to optimize electronic trading of fixed-income, equities and other exchange-based products. FIX is the primary industry-driven, trading-related communications protocol and is the de-facto global language for trading of financial instruments, with growing usage for fixed-income products. Greenlineâs suite of industry leading FIX testing and certification products includes VeriFIX for FIX testing and simulation, CertiFIX for certification and client support and MagniFIX for real-time monitoring of active FIX trading sessions. Greenlineâs product portfolio supports FIX initiatives at any stage and in any trading environment. Through its professional services business, Greenline provides clients with custom system development and proprietary software solutions.
Richard M. McVey, chairman and chief executive officer of MarketAxess, commented, âWe are excited about being part of developing market standards through accelerating growth in the use of FIX protocols. The acquisition of Greenline further broadens the range of technology services that we offer to institutional financial markets, provides a meaningful expansion of our client universe, including global exchanges and hedge funds, and further diversifies our business beyond our core electronic credit trading products.â
â¢ Expansion and diversification of revenue base, complementing secondary trading-related revenue; extension of connectivity solutions beyond fixed-income, into equities and exchange-traded options, futures and commodities.
â¢ Large and growing market for FIX-related products and services with attractive growth rates and margins; according to FIX Global Survey conducted by TowerGroup, 75% of buy-side and 80% of sell-side firms interviewed use FIX for electronic trading and 75% of all exchanges surveyed support a FIX interface.
â¢ Enhanced strategic/competitive position with addition of superior suite of FIX-related products and services in nascent fixed-income market; significant growth expected in FIX fixed-income end-users within next several years.
â¢ Highly complementary to existing technology business in terms of both client base expansion and technology services product and service capabilities.
â¢ Opportunity to deepen and build new client relationships through FIX testing and emulator services and professional services offering.
Greenline was founded in 2000 and has 38 personnel based in Chicago, London and Argentina. Total revenues were approximately $6.0 million for the year ended December 31, 2007, an increase of approximately 40% from the year ended December 31, 2006. Greenline has approximately 120 clients.
In 2008, the acquisition is expected to be additive to free cash flow generation and neutral to earnings per share, including the impact of amortization of intangibles and the opportunity cost of funding. We expect the transaction to be accretive to earnings per share in 2009.