A global broker acquired a broker of a similar size in a deal valued at over £1 billion. Core to the acquisition was the realization of run-rate synergies and optimizing trading platforms. Capco partnered with the client to deliver the end-to-end integration at group level and within individual functions.
The inter-dealer broking industry faces unprecedented pressures on cost reduction, the need to innovate and ongoing regulatory pressures. With broking fees on a decline, inter-dealer brokers must find new ways to offer deep liquidity to the market, generate new revenue streams and provide higher value services.
HOW WE DID IT:
Capco used its extensive project management experience, tooling, and technology change capability to deliver the following services:
- Defined the target state architecture and integration strategy to maximize synergies within the integration window, whilst minimizing client and business impact
- Established a Planning Authority to:
- Define the three-year integration roadmap, key milestones, interlocked dependences, delivery framework, resource allocation and governance structure
- Drive delivery execution, RAID management and effective quality assurance
- Established a Synergy Authority to:
- Provide detailed financial modelling, milestone driven synergies and prioritization
- Provide robust tracking of synergy realisation underpinned by auditable evidence
- Established a Solution Authority to:
- Govern architecture and design to ensure alignment to the target state architecture
- Provide technical guidance, solution direction for new initiatives or technical challenges
- Mobilised a Functional Authority to:
- Industrialize business analysis methods, frameworks, and tools to ensure requirements gathering and definition were consistently executed to a high quality
- Provide subject matter expertise across specific regulatory or business challenges
To execute integration across functions and organizations, Capco mobilized cross-functional change teams to lead the technology integration, location strategy, legal entity restructuring, group functions integration, front office migration and regulatory commitments throughout.
Key Capco capabilities and practices leveraged were:
- Post-merger Integration practice to provide overall PMI strategy, governance, subject matter expertise, synergy management, communications, and program execution
- Data practice to solve complex data migration, governance, and quality issues to migrate broking desks to one trading stack and a single harmonized static and reference data source, as well as the definition of a cloud data strategy
- Technology practice to define the target state application roadmap, migration strategy, decommission strategy, IT target operating model and architecture governance
- Capital Markets practice to solve complex business challenges including the harmonizing of post trade flows, legal entity restructuring and regulatory compliance for MIFID II, GDPR, Brexit, Market Surveillance (etc.) during a major integration initiative
- Capco Digital to design and define the operating model for internal and externally facing front-end support platforms (i.e. website, intranet, careers platform and the content management system)
- Business Consulting Practice to identify and execute process optimization, the execution of the client’s location strategy and operating model definition.
Throughout the integration a robust focus on communications and culture was applied, ensuring all stakeholders at all levels were kept informed and cultural misalignment was identified and harmonized where possible. Traceability from project tasks through to integration outcomes was developed to ensure all resources knew their role in making the integration successful.
WHAT WE DELIVERED:
The integration was completed on time and overachieved its synergy target, all whilst achieving its regulatory and mandatory commitments (e.g. MIFID II, Brexit).
To find out more about Capco's post-merger integration expertise, please contact Derek Lum.