Goldman Sachs Spins Off REDI
Goldman Sachs has sold a majority equity interest in REDI, the technology provider for the REDIPlus Execution Management System (EMS), to a consortium of investors including BofA Merrill Lynch, Barclays, BNP Paribas, Citadel and Lightyear Capital. Goldman Sachs is retaining a significant minority equity stake in the company.
This transaction establishes REDI as an independent financial technology company. The consortium of investors enhances REDI’s business by providing a broad range of benefits to the marketplace through an expanded broker network, broad cross-asset capabilities, expansive global coverage and industry-leading customer service.
In addition, REDI will leverage the valuable strengths of its partners to deliver innovative broker-neutral solutions that span across the trade lifecycle, enrich the client experience and bring added value to customers.
“We are pleased to assemble an impressive consortium of market-leading participants to support the further growth of the REDI business and expand its reach to more clients, geographies and asset classes,” said Darren Cohen, global co-head of principal strategic investments at Goldman Sachs. “The new independent REDI is a strategic initiative for Goldman Sachs and the firm is committed to its future success as a separate, multi-dealer platform.”
REDI’s new headquarters are located in New York City, supported by five regional offices in Boston, San Francisco, Chicago, London and Hong Kong. The core product, technology, sales and support teams associated with the REDI business will continue to manage and invest in the platform under the new ownership structure. Rishi Nangalia, who previously co-managed the Goldman Sachs Electronic Trading Business Development group, will serve as the company’s Chief Executive Officer.
“Barclays is pleased to be part of establishing REDI as an independent company with an innovative multi-broker and multi-asset platform,” said Thomas Chippas, head of prime services execution at Barclays. “We plan to make our award-winning BARX offering available through the REDIPlus platform as an additional channel for our clients, furthering our own strategy of providing e-trading solutions across a range of electronic marketplaces.”
Representatives from each of the investor firms will join the REDI board. “REDI is a leading brand in financial technology and is exceptionally well positioned to deliver the independent, high-quality services that market participants need,” said Donald Marron, chairman of Lightyear Capital. “As the only private equity investor in the consortium, we’re excited about this investment, and we will leverage our broad experience in financial services to help guide REDI’s growth strategy and execute on value-creating strategic opportunities.”
“REDI has established an exceptional reputation as a proven technology and financial services leader,” said Tom Miglis, chief information officer of Citadel. “We are proud to be part of this strategic investment and look forward to working with REDI to further raise the bar in trading technology.”
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