Global exchange operator Nasdaq plans to increase its investment focus in its market technology and information services businesses while examining where it could prune portions other businesses in the coming year.
In addition to its acquisition of investment-strategy provider eVestment in October, Nasdaq management has re-affirmed it investments in initiatives like Nasdaq Private Market, FX, and Ocean dark pool, said Adena Friedman, CEO of Nasdaq during the company’s fourth-quarter earnings call.
Adena Friedman, Nasdaq
“We also decided to continue to increase our investment in our analytics of data initiative, our buy-side market surveillance offering supplemented by the acquisition of Sybenetix, and the Nasdaq Financial Framework as the foundation for our next-generation market infrastructure platform,” she added.
Nasdaq is exploring ways to move its market technology offerings, which has had a deployed delivery model historically, to platforms-as-a-service or software-as-a-service model via its Nasdaq Financial Framework as well.
Friedman also noted that Nasdaq has completed a strategic review of its public relation solutions and digital media service business lines and has decided to sell the assets to the West Corp. Under terms of the deal, Nasdaq and West have agreed to a multi-year partnership in which eligible Nasdaq-listed clients will have access to certain products and services in the transaction.
To push further innovation, Nasdaq has spent an additional $20 million on research and development, which brings its total investment between $65 and $75 million, which is 50% more than the previous year. Michael Ptasznik, CFO of Nasdaq, cautioned that this as a re-allocation of existing resources and not an increase in overall spending for the company.
When asked whether private equity investor The Blackstone Group's $20 billion purchase of a majority stake in Thomson Reuters' financial and risk unit would produce knock-on effects for the exchange operator, Friedman stated that it was too early to tell.
"We're just trying to make sure we understand the contours of that partnership that they have announced and its implications," she added. "Thomson Reuters is a great partner to us in the corporate solutions business and our data business. We would certainly expect them to continue to serve those roles to us going forward."
