Options snaps up Activ Financial as battle for mid-market data vendors heats up

Infrastructure technology and managed services provider Options Technology has bought market data and enterprise data platform provider Activ Financial for an undisclosed sum, to provide global data and trading connectivity to support clients’ applications.

The deal, which was signed last Wednesday, October 13, and which Options expects to close by the end of this month, includes all 123 Activ staff, bringing Options’ total headcount to more than 450.

For some Options execs, the acquisition represents a return to the market data space rather than branching into a new area, as several were part of the management team at then-Activ rival Wombat Financial Technology prior to its sale to NYSE Technologies.

“We’re tremendously excited to be getting back together with Activ. Back in the day, Activ and Wombat were the chief protagonists in the low-latency space,” says Options president and CEO Danny Moore. “We respect what they’ve built, we understand their platform, and we think it’s got a lot of legs.”

In the short term, Belfast-based Options plans to invest in product development, including deploying Cern’s White Rabbit time-synchronization technology globally to synch Activ’s datafeed and to introduce nanosecond timestamps. It also plans to build an open “app store” platform of “differentiating but not proprietary” real-time, third-party data and analytics, which data sources can use to publish their content.

“Activ is a great asset that has struggled to scale. And we’ve had the best sales machine in the industry over the last decade. So if you bolt those together, you should expect fireworks,” Moore says. “We think the core Activ business has the potential to be much bigger, and we believe there is more appetite on the sell side for that kind of service than people realize.”

One industry observer familiar with the situation says pent-up demand for affordable and reliable high-performance data services to rival the major data providers—namely Bloomberg, Refinitiv (now owned by the London Stock Exchange Group), and Ice Data Services (the data arm of Intercontinental Exchange)—is creating a “meaningful opportunity” for new entrants to challenge larger players.

This has prompted a flurry of fintech and data M&A activity this year, including Broadridge’s acquisition of Itiviti, Deutsche Börse buying a range of assets, the recent combination of hardware data appliance vendor Exegy and data and technology provider Vela, and Options’ own purchase of low-latency connectivity and risk provider Fixnetix earlier this year.

And in a recent investor presentation by Pico Quantitative Trading, which is merging with Spac FTAC Athena Acquisition Corp. to become a listed company, the vendor outlined several unnamed acquisition targets, one of which matched Activ’s profile.

“The amount of activity has been meaningfully increasing,” says the industry observer, noting a fresh urgency to acquire assets in this space, and adding that Activ has been rumored to be open to offers for some time. “Activ was a company that has been serially for sale and could not find a buyer. The fact that there were multiple parties interested in acquiring Activ this year … highlights that the market has changed.”

Activ, which is headquartered Wheaton, Illinois, and which has offices in New York, Chicago, and London, did not respond to a request for comment.

The observer also notes that other parties are rumored to be in play, while larger vendors or exchanges may also show interest in some of the recent roll-ups.

“I could see Refinitiv or Ion Trading get involved for some of these assets. I could also see Nasdaq or Deutsche Börse acquire one of these platforms,” the observer says, adding that Options itself may not yet be done with acquisitions. “I could see Options acquiring more front-office capabilities that they can cross-sell, and which increase their total addressable market.”