Acquisition of Paladyne opens up opportunities in hedge funds.
Providers of services to the sell-side and buy-side are forming business combinations that create a one-stop shop for securities processing and investment management.
That’s the motivation behind the acquisition by Broadridge Financial Systems of Paladyne Systems.
“We have been strategically pursuing business opportunities in the buy-side,” Charlie Marchesani, president, securities processing solutions at Broadridge, told Markets Media. “We have a significant securities processing business that focuses on the sell-side and we believe that the trust, independence, neutrality and service-oriented reputation that we have earned is extendable to the buy-side marketplace.”
Paladyne offers an integrated front-, middle- and back-office platform, known as the Paladyne Suite, to hedge funds, asset managers, fund administrators and prime brokers. The Paladyne Suite includes order management, portfolio management, reference data management, data warehouse reporting and reconciliation.
“Paladyne provides Broadridge with enhanced buy-side processing technology capabilities and expertise covering the front, middle and back office across all asset classes,” Sameer Shalaby, CEO of Paladyne Systems, told Markets Media. “Select components of Paladyne can also be potentially extended into Broadridge’s sell-side markets.”
Paladyne will allow Broadridge to service the buy-side as well as extend components of Paladyne’s product offering into its sell-side relationships.
The Paladyne name will be retained and be clearly labeled a Broadridge company. Paladyne will operate as a core business within Broadridge’s Securities Processing Solutions Division (SPS). Shalaby will be the president of the operating entity reporting to Marchesani.
“Our strong relationships with global banks and broker-dealers will give us a strong distribution channels into the buy-side and the providers that service the buy-side,” said Marchesani. “For example, many of our broker-dealer clients own or have affiliated hedge funds, asset management divisions, prime brokerage groups, and custodial businesses. We believe our relationships and our powerful distribution capabilities will be able to drive significant new sales.”
The combination of Broadridge and Paladyne present a complete solution to the industry, Marchesani said.
“Our sell-side relationships and reputation should provide introductions and access to key prospective buyers,” he said, including the ability to move beyond operational offering into front and middle office. Many of the product capabilities of Paladyne will also enhance our sell-side offerings, opening up opportunities to sell products to other constituencies that service the buy-side, such as custodians, prime brokers, administrators and sell-side firms.”