The latest acquisitions news from Clearwater Analytics for you;
Clearwater Analytics (NYSE: CWAN) (“Clearwater”) recently announced two strategic acquisitions, marking a major step toward transforming investment management technology.
Clearwater has entered into a definitive agreement to acquire Beacon, a next-generation leader for cross-asset class modeling and risk analytics for derivatives, private credit and debt, structured products and other alternative assets. Integrated with Wilshire’s equities and fixed income risk capabilities, this powerful engine enables portfolio modeling and risk management, addressing the growing focus on private and alternative assets. With institutional investors now allocating nearly 20% of their portfolios to alternatives, the need for sophisticated risk solutions has never been greater. Beacon’s platform provides complete transparency, openness and extensibility and is used by some of the most sophisticated financial firms including PIMCO, Blackstone, multi-strategy hedge funds, insurance asset managers, banks and energy traders.
Clearwater also announced a definitive asset purchase agreement to acquire Bistro, Blackstone’s proprietary portfolio visualization software platform built for Blackstone’s Credit & Insurance business. As the world’s largest alternative asset manager, Blackstone developed Bistro to support the growth of its insurance clients and provide a comprehensive view of private credit portfolios, including asset analytics, client reporting, and risk management insights. Two key foundational pillars of the Bistro platform are Clearwater and Beacon, and tight integration with these platforms has been—and continues to be—a core architectural construct.
“With this combination, Chief Investment and Chief Risk Officers will have a unified, real-time view of their entire portfolio—from public equities and private credit to structured products and alternatives—all in a single, cloud-native platform. The Clearwater platform will allow them to drill down and comprehensively understand their exposure to a company, industry or geography across all their investments, public and private. That will, in turn, allow them to model their entire portfolio, evaluate cash flows and understand risk. Add to that the industry-leading pre-trade capabilities of the Enfusion platform, and the industry will have a true front-to-back platform, enhancing their ability to make better investment decisions,” said Sandeep Sahai, CEO at Clearwater Analytics.
What This Means for Institutional Investors
For insurance companies and asset owners, these acquisitions represent a fully integrated technology stack for investment management that combines pre-trade, post-trade and risk all in one platform. It will bring all their public and private assets into a single analytics framework, obviating the need for constant upgrades, endless reconciliation and error-prone manual processing. This platform will also enable efficient asset liability matching and regulatory reporting and lower the cost of doing business.
For asset managers, this will mean eliminating inefficiencies in managing private credit, real estate debt, structured products and alternative investments. Clearwater will be the only SaaS platform capable of providing a complete, real-time understanding of exposures, cash flow dynamics and risk correlations across strategies, geographies and asset types. Client reporting that includes a comprehensive view of all their public and private assets and scenario modeling will be dramatically enhanced.
Clearwater’s vision goes beyond solving today’s challenges—its open architecture, single security master, single data plane and ability to do benchmarking provides the foundation for the creation of marketplaces, both commercial and technology. Firms will be able to offer proprietary models for use by market participants. Other firms could offer regulatory reporting enhancements for different countries and tax regimes.
The Details
Clearwater will acquire Beacon for an aggregate purchase price of approximately $560m, 60% of which will be paid in cash, with the remainder to be paid in shares of Clearwater Class A common stock valued at approximately $30.05 per share. With ARR of approximately $44m at the end of 2024, this platform has scale and market acceptance as a leading risk and modeling platform.
The purchase price for the Bistro software is $125m, of which $10m will be paid in cash and the remainder will be paid in shares of Class A common stock, valued at $30.00 per share. This transaction represents the purchase of a platform developed by Blackstone.
Clearwater will use the proceeds from its previously committed $800m Term Loan B, cash on hand, and a portion of its $200m revolving line of credit to fund the acquisitions of Beacon and Bistro and the previously announced acquisition of Enfusion.
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