- Completion of 81% majority stake acquisition of Institutional Shareholder Services (ISS)
- Deutsche Börse becomes a leading global market infrastructure player on the critical development towards more sustainable investing
- ISS’ data and research businesses are highly complementary to Deutsche Börse’s entire value chain
- ISS research offering to retain full editorial independence; ISS not to provide research or analyses on Deutsche Börse
Deutsche Börse AG has successfully completed the acquisition of an 81% majority stake in the governance, ESG data and analytics provider Institutional Shareholder Services Inc. (ISS), following receipt of all necessary regulatory approvals. The acquisition was announced in late 2020.
The highly complementary nature of the deal will enable Deutsche Börse and ISS to jointly serve the ever-growing demand for in-depth extra-financial data, research and analytics. Together, both partners will support market participants in making well-informed investment decisions with a particular view on sustainability criteria. Deutsche Börse thereby further commits to one of the key megatrends in the industry that will fundamentally change the investment business over the coming years.
Stephan Leithner, Member of the Executive Board of Deutsche Börse AG, responsible for the Group’s Pre- & Post-Trading businesses, said: “The quality, precision and breadth of ISS’ data and research is unique in the market. Especially the company’s ESG expertise and data capabilities are highly complementary to Deutsche Börse’s businesses along the entire value chain. This acquisition therefore is a logical step in our ESG growth strategy, adding an important piece to the puzzle to become one of the world’s leading market infrastructure players on this critical development.”
Today, Deutsche Börse already offers ESG indices via its index and analytics provider Qontigo (with its brands STOXX, DAX, Axioma) and ESG derivatives via its derivatives exchange Eurex. In addition, Deutsche Börse recently took a minority stake in ESG analytics provider Clarity AI. The acquisition of ISS is a further demonstration of Deutsche Börse’s commitment to ESG.
“We are pleased to be joining the Deutsche Börse group of companies and look forward to working with our new colleagues in furtherance of our long-standing mission to empower investors and companies to build for long-term and sustainable growth,” said Gary Retelny, President and CEO of ISS. “ISS will continue to deliver the same independent and high-quality research, ratings, and other offerings our clients have come to expect, and we will continue to invest and innovate to ensure they receive next-generation solutions.”
ISS will continue to operate with the same editorial independence in its data and research organisation that is in place today. Deutsche Börse commits to principles of protecting the independence and integrity of ISS’ research, recommendations, ratings and other analytical offerings. To that end, a number of non-interference policies have been put in place. ISS has also established a policy that it will not provide proxy research or other analytical research on Deutsche Börse.
This transaction has been conducted in partnership with current ISS management and Genstar Capital, a leading growth equity investor, who will both continue to hold a stake in the company.
About Deutsche Börse
Deutsche Börse Group is one of the largest exchange organisations worldwide. It organises markets characterised by integrity, transparency and safety for investors who invest capital and for companies that raise capital – markets on which professional traders buy and sell equities, derivatives and other financial instruments according to clear rules and under strict supervision. Deutsche Börse Group, with its services and systems, ensures the functioning of these markets and a level playing field for all participants – worldwide.
Founded in 1985, Institutional Shareholder Services group of companies (ISS) empowers investors and companies to build for long-term and sustainable growth by providing high-quality data, analytics and insight. ISS, which is majority owned by Deutsche Börse Group, along with Genstar Capital and ISS management, is a leading provider of corporate governance and responsible investment solutions, market intelligence, fund services, and events and editorial content for institutional investors and corporations, globally. ISS operates on an arm’s-length basis and Deutsche Börse has adopted principles protecting the independence and integrity of ISS’ research offerings. ISS’ 2,000 employees operate worldwide across more than 30 global offices in 15 countries. Its more than 4,000 clients include many of the world’s leading institutional investors who rely on ISS’ objective and impartial ESG and governance research, market intelligence and fund services and data and analytics, as well as public companies focused on ESG and governance risk mitigation as a shareholder value enhancing measure. Clients rely on ISS’ expertise to help them make informed investment decisions.
About Genstar Capital
Genstar Capital is a leading private equity firm that has been actively investing in high-quality companies for over 30 years. Based in San Francisco, Genstar works in partnership with its management teams and its network of strategic advisors to transform its portfolio companies into industry-leading businesses. Genstar currently has approximately USD 19 billion assets under management and targets investments focused on targeted segments of the financial services, healthcare, industrial and software industries.
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