NEW YORK: Tradeweb Markets Inc. (Nasdaq: TW), a leading, global operator of electronic marketplaces for rates, credit, equities and money markets, has entered into a definitive agreement to acquire Institutional Cash Distributors, LLC (ICD), an institutional investment technology provider for corporate treasury organizations trading short-term investments, for $785 million.

The purchase price is expected to be funded with cash on hand. With the acquisition of ICD and its powerful, proprietary technology, Tradeweb will add a new and fast-growing client channel serving corporate treasury professionals, complementing Tradeweb’s existing focus on institutional, wholesale and retail clients.

Established in 2003, Institutional Cash Distributors enables more than 500 corporate treasury organizations from growth and blue-chip companies (including approximately 17% of the S&P 100 as of December 31, 2023) across 65 industries and more than 45 countries to invest in money market funds and other short-term products to manage liquidity.

Institutional Cash Distributors (ICD) is one of the largest U.S. institutional money market fund portals, and in 2023, had average daily balances of more than $230 billion. The company has a stable, growing and loyal client base, with 99% client retention and an exceptional net promoter score.

ICD’s flagship products include ICD Portal and ICD Portfolio Analytics. The portal is a one-stop shop to research, trade, analyze, and report on investments across more than 40 available investment providers primarily offering money market funds and access to other short term products including deposits, fixed term funds and separately managed accounts (SMAs).

Portfolio Analytics is an AI-driven cloud solution for aggregating positions across a corporate treasury’s entire portfolio for analysis and reporting.

As part of Tradeweb, ICD will provide a comprehensive solution for corporate treasurers and asset managers worldwide to manage short-term liquidity needs and FX risk, as well as optimize yield and duration via Tradeweb’s existing suite of products.

ICD clients will retain the ability to fully integrate their workflows with leading third-party treasury management and accounting systems and ICD’s portfolio analytics solution. In addition to opportunities to cross-sell Tradeweb’s products to ICD’s clients, Tradeweb will aim to accelerate ICD’s growth and expansion by leveraging Tradeweb’s international presence and offering money market funds to Tradeweb’s existing network of clients globally.

Tradeweb CEO Billy Hult said: “ICD is an exceptional opportunity to acquire a leading investment platform for corporate treasurers, a fast-growing channel within fixed income markets and a strong strategic fit for Tradeweb. Acquiring ICD will further diversify our client and business mix, advancing our track record of expanding into adjacent markets to improve client workflows.

As part of Tradeweb, ICD will also be positioned to drive the adoption of electronic trading for corporate treasurers. We look forward to welcoming the talented ICD team onboard, who share Tradeweb’s unwavering commitment to delivering innovative products and extraordinary service, and to jointly creating even greater value for our clients and shareholders.”

Upon closing of the transaction, ICD’s CEO Tory Hazard will report to Tradeweb President Thomas Pluta and will join Tradeweb’s Operating Committee.

Mr. Hazard said: “We could not have found a better partner than Tradeweb to continue providing innovative technology and exceptional service to our clients. This acquisition will enable ICD clients to have integrated access to Tradeweb’s fixed income marketplace, while continuing to trade through our existing technology. The combined offering delivers even more of what corporate treasury wants, and together, we will be able to unlock the full potential of our technology.”

The acquisition is expected to be accretive to Tradeweb’s adjusted earnings per share in the first 12 months following closing and meet Tradeweb’s return on invested capital objectives. Completion of the transaction is expected in the second half of 2024, subject to customary closing conditions and regulatory review.

J.P. Morgan Securities LLC served as the lead financial advisor to Tradeweb. Morgan Stanley & Co LLC also provided advice. Fried, Frank, Harris, Shriver & Jacobson LLP served as legal advisor. Parthenon Capital Partners was the primary investor in ICD. Raymond James and Moelis & Company LLC served as its financial advisors, and Kirkland & Ellis LLP served as its legal advisor.

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