Markit

For other uses, see Markit (disambiguation).

Markit Ltd.
Company typePublic
Nasdaq: MRKT
IndustryFinancial services
Founded2003; 21 years ago (2003)
Defunct12 July 2016 (2016-07-12)
Fatein 2016 merged with IHS Inc. to form IHS Markit
SuccessorIHS Markit
HeadquartersLondon, United Kingdom
Number of locations
21 offices
Area served
Worldwide
Key people
Jerre Stead (CEO IHS Markit) & Lance Uggla (president IHS Markit)[1]
ProductsFinancial information
Financial processing
Financial services
Financial solutions
Market data vendor
RevenueIncrease US$ $1.5 billion [2]
Number of employees
4,500 (October 2015)
DivisionsInformation
Processing
Solutions
Websitewww.markit.com

Markit was a British financial information and services company that focused on credit derivative pricing. It was founded in 2003 and merged in 2016 with IHS to form IHS Markit.

Prior to its merger it had 4,500 employees in 21 offices worldwide and was as an independent source of credit derivative pricing.[3] The company provided independent financial data, trade processing of derivatives, foreign exchange and loans, customised technology platforms and managed services. The company aimed to enhance corporate transparency, reduce financial risk and improve operational economic efficiency. Its client base included institutional participants in the financial marketplace.

On 12 July 2016, Markit and IHS Inc. merged in an all-stock merger of equals to form IHS Markit.[4][5] IHS Markit later merged with S&P Global on 28 February 2022.[6]

History

Foundation and early years

Markit was founded in 2003 by Canadian Lance Uggla[7][8] in St Albans, outside London, as Mark-it Partners to provide daily credit default swap (CDS) pricing.[9]

Markit's credit derivative data sales rose during the subprime mortgage crisis in 2007 and later years.[10]

In September 2009, Markit and Depository Trust & Clearing Corporation (DTCC) launched MarkitSERV, a joint venture to provide over-the-counter (OTC) derivative trade processing.[11]

Acquisitions 2004 - 2009

Totem Valuations, a supplier of consensus valuations and month-end data, was bought by Markit in May 2004.[12]

The International Index Company (IIC) and CDS Index Company (CDSIndexCo), owners of the iTraxx and CDX credit default swap indexes, were acquired by Markit in November 2007.[13][14]

In December 2007, Markit announced the acquisition of SwapsWire.[15]

The BOAT, Markets in Financial Instruments Directive-compliant trade reporting platform acquired by Markit from a consortium of nine investment banks In January 2008. The BOAT was owned by consortium of nine investment banks —ABN Amro, Citigroup, Credit Suisse, Deutsche Bank, Goldman Sachs, HSBC, Merrill Lynch, Morgan Stanley and UBS who had launched the system in September 2006.[16] The Boat platform was established by these nine banks "for the collection and sale of trading data following the introduction of EU's Markets in Financial Instruments Directive (MiFID) in November 2007.

JPMorgan Chase's FCS Corporation, a provider of syndicated loan market portfolio and risk management software and services, including the Wall Street Office family of products, was acquired by Markit in July 2008.[17]

Fidelity Information Services's ClearPar, an electronic loan-trade-processing platform, was acquired by Markit in October 2009 which helped Markit to work with DTCC to improve the processing of syndicated loans.[18]

Public listing and growth

In 2013, Temasek Holdings bought 10% of shares for $500 million, thereby valuing the company at $5 bn.[19]

By 2012, the company had annual revenues of US$860 million, with over 3,000 employees and had a $5 billion valuation.[7] In 2013, different banks held 51% of Markit shares. 20% of shares were held by Markit employees and executives.

On 5 May 2014 Markit Ltd., a company registered in Bermuda, filed for an initial public offering (IPO), to be listed on the NASDAQ Global Select Market under the symbol MRKT.[2][20] The stock began trading on 19 June 2014 with an initial pricing of $24 per share.[21]

Merger

On 12 July 2016, Markit and IHS Inc. merged in an all-stock merger of equals to form IHS Markit.[4]

Index products

On 17 January 2006 CDS IndexCo and Markit launched ABX.HE, a subprime mortgage backed credit derivative index, with plans to extend the index to underlying asset types other than home equity loans.[22]

On 19 January, 2006 it launched the Home Equity (ABX.HE) ABX.[23][24] The following year in 2007 the loan credit default swap index (LCDX), a loan-only credit default swap index was created by CDS Index Company (CDSIndexCo).[25]

Sixteen financial institutions including: JPMorgan, Goldman Sachs, Deutsche Bank, Barclays Capital, Bank of America, BNP Paribas, Citigroup, Credit Suisse, Lehman Brothers, Merrill Lynch, RBS Greenwich,[26] UBS and Wachovia,[25] owned the private company called the CDS Index Company (CDS IndexCo), that developed the ABX index. By 2007 Markit marketed had acquired (CDS IndexCo). The ABX index was a credit default swap of asset-backed mortgages of 30 of the most liquid mortgage-backed bonds.

In 2013, Atlanta-based IntercontinentalExchange, a derivatives exchange and clearing house operator, announced four credit index futures contracts, based on the Markit CDX and Markit iTraxx indices—Markit CDX NA IG, Markit CDX NA HY, Markit iTraxx Europe (Main), and Markit iTraxx Crossover, would start in May 2013.[27][better source needed]

Divisions, products and services

Markit organized itself in three divisions:[2]

Division Information Processing Solutions
Products and services
  • Valuation and Trading Services
    • Portfolio Valuations
    • Totem
  • Pricing and Reference Data
    • major asset classes
    • Reference Entity Database (“RED”)
    • Bond Reference Data
  • Indices
    • PMI series, iBoxx, iTraxx, CDX and iRxx.EM
  • MarkitSERV: derivatives
  • MarkitClear: loans
  • Enterprise Software
    • Enterprise Data Management (EDM)
    • Analytics
    • Wall Street Office (WSO)
  • Managed Services
    • Markit On Demand (MOD)
    • Counterparty Manager
revenue % (2013)

48.5%

28.0%

23.5%

References

  1. ^ "IHS Markit - About Us". ihsmarkit.com.
  2. ^ a b c "Final Prospectus". SEC. 20 June 2014. Retrieved 24 June 2014.
  3. ^ Markit USD Interest Rate Curve XML Specification (PDF) (Report). Markit. 30 March 2009.
  4. ^ a b "IHS and Markit to Merge, Creating a Global Leader in Critical Information, Analytics and Solutions". BusinessWire. 21 March 2016.
  5. ^ "IHS Markit Rings Opening Bell at Nasdaq, Unveils New Logo - IHS Online Newsroom". press.ihs.com.
  6. ^ "S&P Global Completes Merger with IHS Markit, Creating a Global Leader to Power the Markets of the Future". businessinsider.com. 28 February 2022. Retrieved 5 March 2024.
  7. ^ a b "Plumbers in suits". The Economist. 6 July 2013.
  8. ^ Companies House information
  9. ^ Harrison, Natalie (14 November 2007). "Markit says buys IIC, agrees to buy CDS IndexCo". Reuters. Retrieved 14 December 2007.
  10. ^ Baird, Jane (23 November 2007). "Global investors struggle to value credit assets". Financial Post. Archived from the original on 6 December 2007. Retrieved 16 December 2007.
  11. ^ "Markit and DTCC launch OTC derivatives trade processing JV". FinExtra.com. 1 September 2009. Retrieved 30 October 2009.
  12. ^ "Mark-It Partners acquires Totem Valuations". Finextra. 5 May 2004. Retrieved 10 October 2010.
  13. ^ "Markit Buying Owners of iTraxx, CDX Credit Indexes". Bloomberg. 14 November 2007. Retrieved 14 December 2007.
  14. ^ "Markit says buys IIC, agrees to buy CDS IndexCo". Reuters. 14 November 2007. Retrieved 7 March 2024.
  15. ^ "Markit to buy SwapsWire". Finextra.com. 4 December 2007. Retrieved 14 December 2007.
  16. ^ Finextra (22 January 2008). "Markit buys Boat". Finextra Research. Retrieved 4 February 2008.
  17. ^ Dave Valiante (28 July 2008). "JPMorgan's FCS Corporation Acquired By Markit". Wall Street & Technology. Archived from the original on 18 July 2011. Retrieved 21 September 2008.
  18. ^ Michael Aneiro (30 October 2009). "Markit To Acquire Electronic Loan-Trading Platform ClearPar". The Wall Street Journal. Retrieved 30 October 2009. [dead link‍]
  19. ^ "Temasek stake in Markit values data company at $5bn". Financial Times. 21 May 2013.
  20. ^ Alden, William (5 May 2014). "Financial Data Company Markit Files for I.P.O." The New York Times. Retrieved 5 May 2014.
  21. ^ "Markit IPO jumps after selling shares". USA Today. 19 June 2014.
  22. ^ "CDS Indexco and Markit Launch Synthetic ABS Index". Markit. 17 January 2006. Retrieved 14 December 2007.
  23. ^ "ABX.HE makes its grand debut". Asset Securitization Report. 23 January 2006. Retrieved 7 March 2024.
  24. ^ Brinded, Lianna (18 January 2008). "Markit aims to shine light on sub-prime murk". www.fnlondon.com. Retrieved 7 March 2024.
  25. ^ a b Lenzner, Robert (8 August 2007). "Profiting From The Meltdown". Forbes. Some top banks are quietly indexing credit, avoiding the credit bubble and raking in big bucks.
  26. ^ "RBSGC". www.rbsgc.com. Archived from the original on 22 April 2009. Retrieved 30 January 2020.
  27. ^ IntercontinentalExchange (ICE) announced the launch of credit index futures contracts, Press Release Newswire, New York: IntercontinentalExchange (ICE), 11 March 2013