Clearwater Analytics, a pioneer in digital tools for risk and compliance reporting, revealed on Monday that it is definitively poised to take over Enfusion, an investment management platform, for an impressive $1.5 billion.
The acquisition, funded by an $800 million loan and a $200 million revolving credit underwritten by Clearwater, will allow Enfusion’s investors to choose between cash, stock, or a combination. The breakdown of the purchase leans towards an expected $760 million in cash, with an estimated 23 to 28 million new shares being issued to Enfusion stakeholders.
With both companies’ boards green-lighting the deal and pending approval by Enfusion’s shareholders and regulatory bodies, the deal is slated for finalization in the second quarter of 2025.
Enfusion, initially established in 1997 as a tech consultancy firm, shifted their focus to creating a unique portfolio management system after identifying a niche demand in the market. Managed by CEO Oleg Movchan, and backed by key venture capital investors such as ICONIQ Growth and FTV Capital, the company went public with a valuation of $1.9 billion in 2021.
Clearwater Analytics expressed confidence in the purchase, which poses a 13% markup on Enfusion’s stock price, citing the latter’s impressive financial growth. With a reported ~15% YoY growth in revenue in 2024, reaching ~$201 million, and ~13% YoY growth in annual recurring revenue hitting~$210 million, Clearwater terms this purchase a strategic investment.
Part of this strategy involves leveraging Enfusion’s portfolio and order management technology into Clearwater’s offerings, hoping to create an end-to-end platform for the entire investment management industry, and expanding into sectors and geographical regions where Enfusion has already established a footprint.
Clearwater Analytics, operational since 2004, boasts of managing over $7.4 trillion worth of assets on its platform with big names such as J.P. Morgan Asset Management, Facebook, Cisco, and Oracle among its clientele.
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