Newry-based FD Technologies to sell First Derivative for £230m

Seamus Keating, CEO of FD Technologies.Seamus Keating, CEO of FD Technologies.
Seamus Keating, CEO of FD Technologies.
Newry firm FD Technologies has agreed to sell part of its business to a US business for £230million.

The move, which will see its consulting arm First Derivative sold to EPAM Systems, is expected to be completed in the fourth quarter of 2024 and is the last part of a major restructuring of FD Technologies.

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EPAM Systems are a Pennsylvania-based digital technology firm with around 65,000 employees.

FD Technologies say that after customary closing adjustments, transaction and separation costs, net cash proceeds are expected to be approximately £205m.

The deal will enable the repayment of the Group’s net debt, amounting to approximately £20m, as well as facilitating the return of excess cash to shareholders.

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It also enables the Company to focus on KX, the part of the Group with the largest value creation potential, and provides funding for KX to become cash generative, with the resources to execute on the exciting growth plan in its target markets.

Seamus Keating, CEO of FD Technologies, said: “This Divestment is positive for all stakeholders, benefitting our shareholders and the customers and employees of KX and the First Derivative Business.

"For shareholders it enables the Group to focus on KX, and provides the resources to deliver on our exciting growth plans while also enabling us to return excess cash.

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"KX and its customers will benefit from a strengthened and broader partnership with EPAM that opens up opportunities in capital markets and beyond, while the First Derivative Business customers will benefit from EPAM’s scale and reach combined with the deep domain skills in capital markets within the First Derivative Business.

"We look forward to providing an update on the positive trading performance and strategic progress of KX at our interim results in November.”

Balazs Fejes, President of Global Business and Chief Revenue Officer at EPAM, said: “Bringing together the First Derivative Business and EPAM marks the beginning of a distinctive enterprise that will not only enhance value for our clients but also foster substantial growth opportunities for our teams.

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"Leveraging their strong Business and Technology services heritage, especially in capital markets, allows us to expand our financial services solutions portfolio to our clients, who need to evolve and scale their digital ecosystems, gain greater data insights and enhance operations while minimising risks and maintaining regulatory compliance.

"And we are enthusiastic about enhancing our partnership with KX, focusing significant resources to strengthen this collaboration.”

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