Chicago-based Morningstar, Inc. is buying a rating agency that focuses on the structured finance industry for US$52 million in cash and stock, the independent investment research firm said Friday.
The deal for Realpoint, LLC, which includes approximately US$42 million in cash and US$10 million in restricted stock, is expected to close in the next few months, the firm said.
Once the acquisition is completed, Realpoint will become a business unit of Morningstar, and it will eventually be rebranded under Morningstar.
Realpoint currently offers ratings, research, surveillance services, and data to help institutional investors identify credit risk in commercial mortgage-backed securities. It had revenue of approximately US$12 million in 2009.
“We believe there’s strong demand for unbiased ratings and research in the structured credit market, and we think the time is ripe to bring more competition to this market. This acquisition also builds on our recent entry into corporate credit ratings,” said Joe Mansueto, chairman and CEO of Morningstar.
“Realpoint has earned the respect of investors, and has built a solid business by being a reliable source for structured finance ratings and analysis. Realpoint and Morningstar share a strong commitment to investors. Together, we want to restore credibility to the credit ratings business and be a positive force in rating structured products,” he added.
IE
Morningstar to buy Realpoint rating agency
- By: James Langton
- March 19, 2010 March 19, 2010
- 09:46