German stock exchange operator Deutsche Boerse is set to acquire a majority stake in Institutional Shareholder Services (ISS) for nearly $1.8bn.
As agreed, Deutsche Börse will acquire 80% stake in the company, while the remaining stake will be with the current management and Genstar Capital.
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The transaction values ISS, which provides corporate governance and responsible investment solutions, at $2.275bn.
This is the fourth change of ownership for ISS in the last one decade, Reuters reported. In 2017, the current owner Genstar Capital acquired the company for $720m from Vestar Capital Partners.
Vestar bought ISS for $364m from MSCI in 2014. MSCI acquired ISS in 2010 as part of its acquisition of RiskMetrics Group.
With the acquisition, Deutsche Börse seeks to bolster its footprint as a global ESG data and analytics provider. ISS counts more than 4,000 clients which include institutional investors and public companies.
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By GlobalDataDeutsche Börse CEO Theodor Weimer said: “ISS is a very successful company with a high reputation worldwide as a global market leader in providing data, analytics and insights to investors and companies as well as governance services.
“It is one of the leading ESG providers. Its ESG expertise and data capabilities perfectly link to Deutsche Börse’s business model along our entire value chain. Together, ISS and Deutsche Börse have complementary ingredients to become one of the globally leading ESG players of the future.”
The transaction is expected to close in the first half of next year, subject to customary closing conditions and regulatory approvals.
Once complete, ISS will continue to operate independently retaining its current executive leadership team.
