Financial market data provider Interactive Data Corp. said Monday it agreed to buy privately held electronic trading network and services provider 7ticks LLC in a move to speed up its delivery of trading data to institutional customers.
The company said it will use 7ticks network infrastructure technology to further reduce delays, or latency, in its data feeds. Financial firms employ automated trading programs that can spot market changes and facilitate large blocks of stock, options and commodities trades. The firms require ultra low latency between their trading systems and stock exchanges and other trading venues in order to implement their investment strategies most successfully.
Interactive Data did not disclose the price of the acquisition, which it expects to complete early next year. The company expects the deal will start adding to its earnings by 2011.
Interactive Data plans to retain 7ticks' 42 employees. The Chicago-based business will be run as part of Interactive Data's new real-time market data and trading services group, which is being headed by Jeffrey Banker. 7ticks is in the process of increasing its U.S. equities coverage and has plans to expand further into Asia and Europe in the coming twelve months.
"Increasing our penetration in the electronic trading sector is one of our top long-term strategic priorities, and we believe that acquiring 7ticks will enable us to make significant progress in this area," said Ray DArcy, Interactive Data's president and CEO, in a statement.
Interactive Data shares closed earlier up 12 cents at $25.89.