Bond trading platform operator MarketAxess has finalised its purchase of pre- and post-trade reporting and matching firm Xtrakter, and plans to use the acquisiton to capitalise on regulatory changes in Europe and expand its buy-side client base.
MarketAxess has appointed electronic trading veteran Robert Urtheil to run Xtrakter, after the £25.3 million purchase was completed early in March. A key aim of the acquisition involves MarketAxess extending Xtrakter products to its 1,100 buy-side clients.
“There is demand from our buy-side clients for greater pre-trade transparency, which is largely driven by incoming regulation such as MiFID II,” Urtheil told theTRADEnews.com. “The broader requirement for transaction reporting is also a key regulatory component, and will require asset managers to work with a supplier such as Xtrakter as the sell-side has already done for many years,” he said.
Besides its regulatory transaction reporting service, Xtrakter provides financial market data and trade matching services for European securities markets and Urtheil said the firm will continue to build its data offerings, citing demand from buy-side firms wanting to analyse more data.
In particular, the development of MarketAxess’ execution business has driven growth of its data capabilities in the credit market, which Urtheil believes wil position the firm well to grow its data offering.
“This acquisition will drive new revenue synergies and product development as we look at ways to bring together Xtrakter’s capabilities with MarketAxess’ expertise and our existing client base,” Urtheil said.
Urtheil has extensive experience with market structure issues in Europe and joins from management consultancy Oliver Wyman, where he was partner and global head of its market infrastructure business. He also had a 10-year stint at Deutsche Börse, where he rose to head of market development and strategy.
As Europe undergoes a wave of regulatory change, with MiFID II joining the European markets infrastructure regulation and the second iteration of the Market Abuse Directive, Urtheil believes there are areas where market participants can work together.
“The absence of a consolidated tape for equities or fixed income in Europe has been consistently raised as an issue by market participants. We’re working closely with industry bodies such as the Association for Financial Markets on this and look forward to continue working with them and regulators in the coming months,” he said.