Bond market operator, MarketAxess, has entered into a definitive agreement to acquire Pragma, a quantitative trading technology provider specialising in algorithmic and analytical services in equities, FX and fixed-income.
Pragma’s broker-neutral, multi-asset trading solutions are used by asset managers, hedge funds, broker-dealers, banks, and exchanges. The company’s algorithmic trading platform and quantitative execution solutions are designed to provide equities and FX clients with automated, AI-driven, multi-asset and multi-market execution solutions. Last year, Pragma reports it handled over US$2 trillion of algorithmic order flow in multiple asset classes on behalf of clients across over 50 venues.
Earlier this year, MarketAxess announced the first client algorithmic trade executed across multiple protocols in US credit using Adaptive Auto-X, the company’s multi-protocol automated execution solution currently in pilot. In 2020, Pragma introduced a neural network-based execution engine that is intended to control the routing, sizing, pricing, and timing of orders, with the goal of improving execution quality. Pragma’s algorithmic platform and technology team will help MarketAxess accelerate development of execution algorithms and data-driven analytics across all fixed-income products.
Chris Concannon, chief executive officer of MarketAxess, commented, “Our acquisition of Pragma underscores MarketAxess’ commitment to innovating, integrating, and providing our clients with quantitative, AI-powered technology solutions powered by proprietary data designed to simplify and enhance their workflows. In addition to accelerating our leadership in the fixed-income automation and algo space, Pragma’s years of expertise with FX algos provides a unique opportunity for FX hedging solutions for our Emerging Market clients.”
David Mechner, Pragma’s founder and chief executive officer, said, “Pragma and MarketAxess share a common mission of using technology and automation to improve trader efficiency and generate superior trading outcomes for investors. MarketAxess’ scale and resources will amplify the results we can deliver for clients with the cutting edge technologies we’ve built – both for our existing clients in equities and FX, and for MarketAxess’ large client network as we continue developing new solutions in fixed-income.”
The transaction is expected to close in the fourth quarter, subject to the satisfaction of customary closing conditions.
Broadhaven is serving as financial advisor and WilmerHale is serving as legal adviser to Pragma. Weil, Gotshal & Manges is serving as legal advisor to MarketAxess.
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