Hong Kong Exchanges & Clearing (HKEX) has confirmed the completion of its acquisition of exchange and regulation technology provider, Shenzhen-based Ronghui Tongjin.
Ronghui Tongjin is a subsidiary of Shanghai-listed Shenzhen Kingdom Sci-Tech, which provides IT services to Chinese securities, asset management, regulatory agencies and integrated finance firms. It has more than 6,000 employees, with 200 of those making up the team at Ronghui Tongjin.
HKEX stated it has acquired a 51% equity stake in Ronghui Tongjin, which has now become a subsidiary of HKEX Group. Shenzhen Kingdom Sci-Tech and employees of Ronghui Tongjin have retained equity interests of 29.4% and 19.6% respectively.
“This investment marks a significant milestone in expanding our technology resources and forms a key part of our broader Strategic Plan to develop strong alliances with technology partners,” said HKEX chief executive, Charles Li. “We warmly welcome our colleagues at Ronghui Tongjin to the HKEX family, as we continue to work towards leveraging technology for our future growth.”
First announced in February, HKEX said at the time that the deal will support its strategy to expand its markets technology capabilities by reducing reliance on third-party vendors and implementation risks, as well as helping manage development costs.
HKEX added that Ronghui Tongjin also has a strong research and development team within the financial technology space, and in the long term, the acquisition will allow the exchange group to develop future IT strategic initiatives and tap into new market segments.
“The global capital markets are being propelled forward by technological developments, and we are very pleased to have signed a letter of intent today with Ronghui Tongjin,” said Li at the time. “As committed technology partners, together we will seek to further enhance our existing capabilities, expand our reach and create growth opportunities.”