Fintech unicorn Capitolis to acquire eSecLending for $200 million
The company's fourth acquisition in five years will add securities lending capabilities and 120 employees while expanding its client base to include major institutional asset owners.
Fintech unicorn Capitolis has agreed to acquire US-based eSecLending for $200 million in cash. eSecLending is an independent firm in the securities lending sector that works with many of the world's largest asset owners, including pension funds, insurance companies, asset managers, and other institutional investors, helping them lend securities to major global banks.
"The acquired company is based in Boston and other US cities. It has been a partner of ours for a long time and possesses a set of capabilities that are complementary and highly important to our operations. It is a key provider for institutional clients in its field," Gil Mandelzis, CEO and founder of Capitolis, told Calcalist. "We began discussing the acquisition a year ago, and it has now been finalized. This is our fourth acquisition. Many companies in the industry manage to carve out a niche and dominate it, but achieving massive growth is more challenging."
"They have 120 employees who will join our 200-strong workforce," Mandelzis added.
The transaction is subject to customary closing conditions, including regulatory approvals and antitrust clearance. Capitolis is acquiring eSecLending from Parthenon Capital and the company's management team. As part of the transaction, Parthenon Capital will also invest in Capitolis.
To date, Capitolis has raised approximately $300 million.
Over its 26 years of operation, eSecLending has built an extensive network of relationships with institutional investors, banks, and major global brokers. The company provides customized securities lending and collateral management solutions, helping institutional investors optimize securities lending strategies, manage collateral, and access securities financing markets.
The acquisition expands the Capitolis platform by adding securities lending as a complementary capability to its existing financial resource management solutions. The combined offering will provide banks and institutional investors with a broader range of capabilities across securities lending, repo, and financing markets, while expanding Capitolis's reach to eSecLending's established network of institutional asset owners.
"This acquisition transforms Capitolis and marks a significant step in the company's evolution," said Mandelzis. "Capitolis continues to grow rapidly and has already become a key strategic partner to most of the world's largest banks. This acquisition aligns perfectly with the company's growth strategy and embeds us even deeper into our clients' core business operations with a high-quality solution that integrates seamlessly into Capitolis's existing suite of offerings."
Mandelzis added, "In recent years, we have experienced exceptional organic growth across all our business lines. eSecLending adds a new, highly complementary business area that naturally addresses our clients' evolving needs. Our commitment remains unchanged: to collaborate with the industry and bring the broadest, most comprehensive range of solutions and innovations to the market. This acquisition marks a significant milestone in that journey."
The deal marks Capitolis's fourth strategic acquisition in five years, according to the company.
Craig Starble, CEO of eSecLending, said Capitolis has global reach, a strong commitment to innovation, and relationships with many of the world's leading financial institutions.
"Joining them enables us to expand the solutions we bring to market and deliver even greater value to our clients. We are very proud of what we've built and grateful to the team, clients, and partners who have been part of that journey," he said.
eSecLending Europe Limited is not included in the transaction and will continue to provide services to eSecLending.
