Clearwater has agreed to buy investment management platform Enfusion for $1.5 billion

Clearwater Analytics, a company that develops accounting, compliance and risk reporting tools for asset managers, He said On Monday, it entered into a definitive agreement to acquire investment management platform Enfusion for $1.5 billion.

Clearwater, which says it has secured an $800 million loan to finance the deal, along with a $200 million revolving line of credit, will allow Enfusion shareholders to choose whether to receive cash, stock or a combination. Clearwater expects to pay $760 million in cash and issue approximately 23 million to 28 million new shares to Enfusion shareholders.

The boards of directors of both companies have agreed to the terms. If approved by Enfusion’s shareholders and regulators, Clearwater expects the transaction to close in the second quarter of 2025.

Enfusion, based in Chicago, was founded in 1997 as a technology and operations consulting firm. After noticing a gap in the market for a portfolio management system, Enfusion’s managing partners focused their efforts on launching the company’s existing investment tools.

Enfusion has raised tens of millions of dollars in venture capital from investors, including ICONIQ Growth and FTV Capital, which own 45% of the company along with Enfusion CEO Oleg Movchan. After going public in 2021, Enfusion value In the amount of $1.9 billion.

Clearwater maintains that its purchase, for which it is paying a 13% premium over Enfusion’s share price as of January 10, is a prudent one, pointing to Enfusion’s recent encouraging financial data. Enfusion reported pro forma 15% year-over-year growth in revenue in 2024 to approximately $201 million, and pro forma 13% year-over-year growth in annual recurring revenue to approximately $210 million.

Clearwater also sees Enfusion as a way to build a “direct platform for the entire investment management industry.” In a press releaseClearwater says it plans to integrate Enfusion’s portfolio and order management technology into its offerings while expanding into the hedge fund industry and geographies where Enfusion is already present.

Clearwater, which launched in 2004, claims to have more than $7.4 trillion in assets on its platform. Notable clients include JP Morgan Asset Management, Facebook, Cisco, and Oracle.