REDI Buys, Integrates BAML's InstaQuote EMS

The move is REDI's first as an independent company, and was initiated last July when the bank took an equity interest in the EMS provider soon after its spinoff from Goldman Sachs, according to REDI chief technology officer Josh Schubkegel. The heavy technology work took about six months, he says, integrating InstaQuote's "behind the scenes" functionality with REDI's front end through iterative development and three months of beta testing.

The deal will increase the provider's client base by more than 20 percent, including several dozen small and medium-sized redistributing brokers, a new subset of REDI user. It will enhance the middle-office, prime brokerage and clearing connectivity, and risk management capabilities of the REDIPlus EMS, rounding out the workflows required after execution. And 30 InstaQuote employees are now also based at the vendor's new client services hub in Dallas, Texas.

Unique Heritage
"The goal wasn't just to bring InstaQuote on, and fold them in under our umbrella and keep them siloed and autonomous," Schubkegel says. "In a way we wanted to take the harder path, of a fully-consolidated and unified platform. And InstaQuote, originally a small software shops that was bought and spent many years with a major investment bank, has the same kind of unique heritage as REDI."

The CTO adds that REDI is in additional discussions on similar projects, talking with other major sell sides and external parties looking to either sell off their execution technology so as to focus on their core businesses, or take advantage of REDI's private cloud infrastructure and distribution capability. "They want to maintain the value-add of the capability they've built, without having to manage every part of the stack and keep up with pace of change," he says. "With this partnership, we've proven we can deliver on that."

And the same line of thinking helped drive the deal for Bank of America, too, says REDI board member and BAML head of global strategic direct investments Bina Kalola.

“Through the integration of InstaQuote, REDI is transforming electronic trading for the benefit of all market participants," she says. "We recognize the industry’s needs are changing, which further underscores the value of a broker-neutral platform like REDIPlus. As the industry evolves, we expect REDI to play a significant role in the consolidation of EMS platforms.”

Final terms of the acquisition were not disclosed.