Cinnober sells majority stake in Irisium to KRM22
KRM22 acquires 60% in Irisium
KRM22, a London-listed tech investment company, is acquiring a 60% stake in Irisium, a subsdiary of trading tech firm Cinnober, for £2.571 million in cash.
This is KRM22’s first investment since listing on London Stock Exchange’s AIM at the end of April this year. The company focuses on risk management and capital markets. As part of the IPO, Cinnober invested £1.2 million to purchase 1.2 million shares, representing an ownership stake of just over 9.7% in KRM22.
Cinnober will retain a 40% stake in UK-based Irisium, which provides a real-time market surveillance solution.
There is further potential consideration for Cinnober should Irisium achieve certain financial milestones in 2019. Cinnober has the potential to receive £600,000 in the event that Irisium achieves £2 million of annualised recurring revenue as at 30 June 2019. This consideration can be satisfied in either cash or ordinary shares of KRM22 at KRM22’s discretion.
As a result of the transaction, Cinnober says it will report a financial gain, receive a cash inflow, and going forward, will have a reduced cost base.
Irisium – formerly known as Ancoa Software – was acquired by Cinnober in May 2017. It has 22 employees, 13 customers and a recurring revenue base of approximately £1 million. As part of the contract, Cinnober will continue to sell the Irisium offering to its core exchange market, KRM22 will sell to derivatives trading firms and hedge funds and Irisium will sell directly to all other capital markets sectors.
Cinnober and Minium: first win
Meanwhile, Cinnober’s another subsidiary, Minium Financial Technology, has been selected by Marex Spectron to deliver a cloud-based real-time risk management platform to support Marex’s growth in exchange-traded derivatives and FX.
The solution will allow Marex, a global broker of financial instruments in the commodities sector, to enhance its monitoring of counterparty risk in real-time across multiple asset classes.
This is Minium’s first customer and Marex is a pilot site.
Marex will leverage Minium’s tech to consolidate a number of legacy systems it currently uses into a single platform with additional key features, including initial margin and valuation replication over 24 global CCPs with the ability to perform simulations in a number of scenarios.
The project will be delivered in phases, beginning in Q4 2018.
Minium was established in late 2016 to offer real-time clearing and risk management solutions and services to international banks and brokers, building on Cinnober’s existing technology and expertise.
