Rule Financial snapped up as GFT pushes into investment banking
Rule Financial, the London-based investment banking consultancy, has been acquired by GFT Technologies, adding some €42 million to the German technology firm’s turnover for the second half of this year.
The terms and value of the deal were not disclosed. In 2013 Rule made a pre-tax profit of £1.25 million on a turnover of £48.20 million. The company focuses on business and IT consultancy and IT service and has some 800 staff internationally, including 660 permanent. Its clients include nine of the world’s 10 leading investment banks.
GFT sees the acquisition as strengthening its position in the UK, where it has had a presence since 2000 and USA, where it has operated since 2008. “In this sector, the GFT Group is one of the few listed family businesses with strong German roots. The acquisition of Rule Financial will strengthen our position in the fast-growing capital markets sector,” said Ulrich Dietz, chief of the GFT Group. “At the same time, we are also laying the foundations for much faster organic growth. By pooling our offerings, we can now provide an even more comprehensive portfolio of solutions for the banking sector – including the necessary business consultants and IT experts. We regard the move as a clear win-win situation for both companies. As a powerful innovation partner, we aim to shape the sector’s future together.”
GFT’s IT side covers retail and investment banks and says that with the addition of Rule Financial, it is now represented equally in both sectors. Marika Lulay, chief operating officer of the GFT Group, said: “We see further strong growth potential in the field of investment banking. A raft of new regulation in the UK and USA is forcing all market participants to make radical adjustments to their processes and IT systems. As their trusted partner, we are ready to help. We are an attractive employer with highly skilled business specialists and IT experts who can guarantee a top-quality and punctual implementation of these complex IT projects, using innovative technologies and methods.”
In London, Rule Financial has 250 business and IT consultants, with a further 80 in New York, Boston and Toronto. The Rule Financial nearshore facilities in Poland, Spain and Costa Rica provide 480 programmers, who will complement GFT’s development centres in Spain and Brazil which currently have over 1,400 experts. “This further strong expansion of our nearshore capacities means we can ensure the fastest possible and most cost-effective implementation of IT projects in the relevant client’s respective time-zone,” said Lulay. Following the acquisition of Rule Financial, the GFT Group’s headcount now amounts to approximately 3,000 staff.
Chris Potts, chief executive of Rule Financial said: “There were many potential suitors for the firm, but our management team was soon convinced that GFT was the best fit for us – and vice versa. The location of our various offices, our nearshore capacities, client relationships, solutions offered and organisational structure all fits together like a jigsaw, and multiplies our opportunities. This transaction is clearly based on growth in all areas – which will also benefit all our employees.”
Following the acquisition, the GFT Group expects additional revenues in the second half of 2014 of “around” €42 million. As a result, the GFT Group’s expected revenues for financial year 2014 have increased to around €352 million.