KRM22 Continues M&A Spree, With More to Come

KRM22 is acquiring Amsterdam-based risk management and post-trade services provider Object+ for an initial consideration of $1.15 million (~£911,000). 

“There are great companies out there with great individuals and teams that have got great products, but they have got a massive challenge of scaling,” says Keith Todd, CEO and chairman at KRM22. “By being able to come on board within the KRM22 family, we provide the environment by which growth opportunities will be easier to achieve for the products they have got.”  

We have said very publicly that we are expecting to do one partnership or acquisition a month throughout this year

Keith Todd

Last year, KRM22 was listed on the AIM, the London Stock Exchange’s market for small-cap companies. Since then, it has made four acquisitions. The most notable of these moves include taking a 60% stake in market-surveillance specialist Irisium, and its outright purchase of Chicago-based risk-tech vendor Prime Analytics, which offers software products under the brand name ProOpticus. 

According to Todd, the firm’s acquisition strategy has two fundamental drivers: adding subject-matter expertise and growing its customer base. “Every one of Object+’s customers is a potential customer for Irisium, and a number of them are potential customers for ProOpticus,” he says. “So the cross-selling from the KRM22 perspective grows with every acquisition.” 

Todd confirms they have more takeovers planned in the pipeline. “We have said very publicly that we are expecting to do one partnership or acquisition a month throughout this year, and we are on track for that,” he says.  

Object+

Object+, which also has offices in Chicago, has a small staff of eight people, but it was started in the 1990s, so it has longevity. As Todd noted previously, this acquisition will allow Object+ to expand its offering and will be a nice add-on for clients of ProOpticus and Irisium.

The Object+ suite of solutions includes real-time P&L and margin management, as well as pre-trade order-limit-management capabilities. This acquisition will also allow KRM22 to share data between systems—once integrated—thus eliminating the need for multiple market data sources and reconciliations for its customers, according to the vendor.

Todd says that the acquisition process itself took the best part of eight months. He adds that Object+ will keep operations in Amsterdam, but will eventually be re-branded. “We will, overtime, retire the company brand and migrate to [the] KRM22 branding convention,” Todd says. “But as with all these things, there needs to be a transition time. Object+ is a well-respected brand by its customers and we are in no rush to lose the market recognition that exists in Object+.” 

Much of KRM22’s M&A strategy revolves around the fact that buy-side firms do not want fragmented systems; rather, they would prefer a one-stop shop for specialist tools. The key, Todd says, is making sure that these platforms are not disjointed—they need to “talk” seamlessly with one another.

“You need specialist capabilities, but brought together in an integrated way, which is the central premise of KRM22,” he says. 

KRM22 has customer-facing offices in London, Chicago, New York, Singapore and Sydney. Additionally, it has development teams in Seville, Prague, and now Amsterdam. KRM22 has just under 80 full-time employees, globally.