First Derivatives acquires Affinity Systems in £7.7m deal

Financial software and consultancy group First Derivatives has acquired Affinity Systems in a deal worth up to £7.7 million (€10.6 million).

The price tag includes an initial consideration of £3.7 million made up of £2.8 million in cash and £900,000 in shares. The remaining £4 million will be paid once revenue targets are achieved in the period to February 28th 2018.

The deal will help FD expand its software and consulting services within the Internet of Things. Ontario-based consultancy firm Affinity also develops software to deal with complex issues across a number industries, and recently released a solution to address enterprise big data challenges. The Sensor Data Management (SDM) solution is built on kdb+, and FD said Affinity’s technology has been proven for applications such as smart meter data management, high-velocity web page creation and real-time financial data distribution.

The company employs 45 people. It reported revenue of CAN$4.3 million in the year to June 20th 2014, with earnings before tax of CAN$300,000.

Last year, Affinity worked with Kx Systems as a consulting, sales and training partner, a firm in which FD has a 65 per cent interest.

Joint managing director of Affinity Leslie Goldsmith said the deal with FD would allow Affinity to accelerate product development and bring it to international markets faster.

"Affinity is a natural fit for FD," said FD chief executive Brian Conlon. "Both the strategy of developing software products built on kdb+, one of the world's most powerful databases, and the cultural ethos of Affinity, mirror that of FD. While we have applied our domain knowledge within capital markets, Affinity brings the company expertise across a number of new vertical sectors."

The latest purchase continues FD's current round of acquisitions. Last month the company announced it had bought Dublin-based ActivateClients for €4.75 million. In February, it said it would buy American data analystics firm Prelytix for up to £13 million.

Earlier this year the company unveiled plans to expand into digital marketing with the launch of its first cloud product.