Nasdaq (NDAQ.O) has agreed to buy financial software firm Adenza from private-equity firm Thoma Bravo for $10.5 billion in a cash and stock deal, it said on Monday.

The deal is expected to help growth at the stock exchange operator, which is trying to diversify and reposition itself as a financial technology company under Chief Executive Officer Adena Friedman.

Adenza provides software for investment banks, asset managers, and other financial institutions. The company’s products help clients manage risk, trade securities, and comply with regulations.

Nasdaq said the acquisition would give it a leading position in the financial technology market. The company expects to close the deal in the fourth quarter of 2023.

Shares in Nasdaq fell 1.5% in premarket trading on the news. The Wall Street Journal reported on the deal earlier.

Analysis

The acquisition of Adenza is a strategic move by Nasdaq as it seeks to expand its reach into the financial technology market. Adenza’s products are used by some of the largest financial institutions in the world, and the acquisition will give Nasdaq a significant foothold in this growing market.

The deal is also a sign of confidence in Nasdaq’s leadership. Adenza’s CEO, Michael Cavanagh, will join Nasdaq as president of its market technology business. Cavanagh is a respected figure in the financial technology industry, and his appointment is a sign that Nasdaq is committed to growing its financial technology business.

The acquisition of Adenza is a positive development for Nasdaq. The deal will help the company to grow its financial technology business and expand its reach into new markets.