SS&C pleases analysts with Citi alternatives purchase
Investment bank Jefferies upped its target price on SS&C Technologies after the firm finalised its $321m acquisition of Citi’s alternatives business.
New York-based analyst John DiFucci reckons shares in Nasdaq-listed SS&C are worth $72 apiece following the deal, 18% higher than the current $61 trading price.
“We believe SS&C has ample opportunity to drive cost synergies, as Citi currently has 10% EBITDA margins, with the potential to expand to 40% over time,” said Jefferies’ DiFucci.
The purchase has positioned SS&C as the second largest global fund administrator handling $1trn worth of assets.
Last week’s acquisition added more than 1,400 staff across 13 offices, 265 customers, and close to $395bn in assets under administration.
The acquired unit will operate within SS&C GlobeOp and continue to be led by Mike Sleightholme on hedge fund services and Joe Patellaro on private equity services.
Both report to Rahul Kanwar, head of SS&C Alternative Assets.
Bill Stone, chairman and chief executive of SS&C Technologies said the combined entity creates a “worldwide fund administration powerhouse”.
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