SuperDerivatives Sold to NYSE Operator for $350m

Derivatives-pricing firm believed to employ hundreds in Israel, where its clients include all seven major banks.

Bloomberg

SuperDerivatives has been sold for $350 million to Intercontinental Exchange, the company that runs the New York Stock Exchange among other operations.

SuperDerivatives’ global development and support center is in the Azrieli Center in Tel Aviv, and the company – engaged in the pricing of derivatives and risk management systems – is believed to have hundreds of employees in Israel.

In fact, a majority of the company’s 300 employees are based in Israel, although it is incorporated in the United States. The company recently expanded its operations here and leased an additional half-floor at the Azrieli Center. Although at this stage it is not clear what the future of the company’s staff in the country will be, it is reasonable to assume that it will at least run its development center from here, which employs a staff of more than 100.

In the past, SuperDerivatives had plans for an initial public offering, but the company – founded in 2000 by its chairman and CEO, David Gershon – ultimately chose to sell to Intercontinental.

SuperDerivatives has developed a platform for pricing, risk management and trading in options that the company said is used by nearly all of the world’s major financial institutions, including Deutsche Bank, Credit Suisse, Citigroup and Barclays, as well as regional banks in more than 45 countries. It also serves accounting firms, investment funds and corporations around the world. It is headquartered in New York.

In Israel, its clients include all seven of the country’s major banks, as well as investment firms and corporations including Israel Chemicals, Cellcom, Nice, ECI, the Delek Group, Oil Refineries Ltd., and Israel Aerospace Industries.

The major shareholders of SuperDerivatives are Gershon; Lewis Ranieri and Scott Shay, who are American investors who in the past had holdings in Bank Hapoalim; and the Accel and Pitango venture capital funds. Several years ago, SuperDerivatives considered selling shares to the public at a corporate valuation of up to a billion dollars, far about its ultimate sale price to Intercontinental.

Over the last half year, it went in search of a buyer. Intercontinental Exchange, which has actually been a client of SuperDerivatives, is buying the company in a cash transaction that is slated to close in the fourth quarter of this year.