In order to provide more complete financial information to both investors and companies intent on expanding their risk data, recent strategic acquisitions and partnerships show a demand for access to private and public company financial and industry related data.
Mergent Inc. and London Stock Exchange Group (LSEG)
In November 2016, the London Stock Exchange Group announced an agreement to acquire Mergent Inc. Mergent’s roots are deep with a long history of providing business and financial information on public and private companies. John Moody, by publishing the first edition of Moody’s Manual of Industrial and Miscellaneous Securities, became a pioneer in the field. This publication provided investors background and statistical information on US company stocks and bonds. Coverage areas grew to include Transportation, Bank & Finance, Public Utilities and more. In the early 2000s, Moody’s sold its publishing business to Mergent, Inc., and the manuals came to be known as “Mergent Manuals” (150 Years, MIT). Today, the Mergent business now forms part of LSEG’s Information Services Division and supports the growth of FTSE Russell, a stock indices company.
In the LSEG press release, Mark Makepeace, chief executive FTSE Russell, states that Mergent will broaden their range of data services, research and analytics to meet the increasing demands of their clients for benchmarks and related data and analytic services.
The acquisition adds “more firepower to [LSEG’s] data services at a time when investors [are] turning to customized indices rather than stock-picking to beat the market” (Daker).
Rapid Ratings and Pool4Tool Partnership
Rapid Ratings and Pool4Tool (who announced a planned merger with Jaggaer on June 5) announced on June 7, 2017, a partnership that will incorporate Rapid Ratings’ Financial Health Rating (FHR) within Pool4Tool’s SRM, SCM, and sourcing portals. Pool4Tool is a provider of direct procurement software with a portfolio that includes solutions for over 40 processes including sourcing, supplier management (SRM), supply chain management (SCM), quality control, and product lifecycle costing. The partnership will allow companies to leverage the FHR “for a predictive view of the financial stability, operating efficiency, and probability of default for vendors, suppliers, and other third-party relationships” (Pool4Tool press release).
Rapid Ratings’ quantitative Financial Health Ratings offers financial health analysis for both national and international public and private companies and is unique in that it rates public and privately held companies globally on the same basis. Rapid Ratings’ innovative model was created in 1991 and implemented in 1998-2001. It’s approach differed from the older, more established rating companies.
Dun & Bradstreet and ThomasNet.com
On March 2, 2017, Dun & Bradstreet and ThomasNet.com announced a partnership to combine Dun & Bradstreet’s financial and business risk data with ThomasNet.com’s suppliers’ company and capabilities content, thereby increasing ThomasNet.com’s value as not only a source for supplier discovery, but also for diligence as well. As a result, Supplier Evaluation & Risk Reports are now available on ThomasNet.com. Dun and Bradstreet will provide supplier evaluation and risk data; public filings such as lawsuits, liens and bankruptcies; and financial risk indicators. ThomasNet.com will provide supplier capabilities based on their their taxonomy of product and service categories; locations; and quality and diversity certifications. “For businesses managing multiple third-party relationships, having a data-informed line of sight into their potential suppliers is a business imperative,” said Brian Alster, global head of Supply and Compliance, Dun & Bradstreet. “Supplier Evaluation & Risk Reports will help procurement professionals surface the must-have information quickly to assess partners, mitigate supply chain disruption, and get back to business” (ThomasNet.com press release).
Moody’s Corporation to Acquire Bureau van Dijk
On May 15, 2017, Moody’s Corporation announced it will acquire Bureau van Dijk (BvD). BvD is a highly respected company in the business research world, providing global, regional, and national coverage for listed and private companies with detailed financials and corporate structure data. Its international private company coverage and detailed ownership data are its strengths. Overall, BvD provides information on more than 220 million companies in all countries worldwide, with an emphasis on private company data. According to the Financial Times:
Moody’s will expand Amsterdam-based Bureau van Dijk’s data platform in Asia and the US to drive revenues using its existing operations. For the credit rating agency, which provides analytical services predominantly to clients in the financial services industry, the acquisition will bolster efforts to diversify its business, as 70 per cent of Bureau van Dijk customers are non-financial entities (Fontanella-Khan).
“150 Years in the Stacks,” MIT Libraries. n.d. Accessed May 30, 2017. https://libraries.mit.edu/150books/2011/02/18/1903/
Dakers, Marion. “London Stock Exchange Adds to Data Service with Mergent Takeover.” The Telegraph. November 21, 2016. http://www.telegraph.co.uk/business/2016/11/21/london-stock-exchange-adds-data-service-mergent-takeover/
Fontanella-Khan, James. “Moody’s Strikes €3bn Deal to Buy Dutch Information Provider Bureau van Dijk.” Financial Times. May 15, 2017