Clearwater agrees to buy investment management platform Enfusion for $1.5 billion

Clearwater Analytics is a company that develops accounting, compliance and risk reporting tools for asset managers. he said on Monday reached a definitive agreement to acquire investment management platform Enfusion for $1.5 billion.

Clearwater, which said it has obtained an $800 million loan to finance the transaction, along with a $200 million revolving credit line, will allow Enfusion shareholders to choose to receive cash, stock or a mix. Clearwater expects to pay $760 million in cash and issue approximately 23 million to 28 million new shares to Enfusion shareholders.

The board of directors of both companies agreed to the terms. If Enfusion’s shareholders and regulators approve, Clearwater expects the deal to close in the second quarter of 2025.

Based in Chicago, Enfusion was founded in 1997 as a technology and operations consulting firm. After seeing a gap in the market for a portfolio management system, Enfusion’s managing partners focused their efforts on launching the company’s current investment tools.

Enfusion has raised tens of millions of dollars in venture capital from investors including Iconiq Growth and FTV Capital, which together with Enfusion CEO Oleg Movchan own 45% of the company. After going public in 2021, it became Enfusion is evaluated At the level of 1.9 billion dollars.

Clearwater argues that the purchase, which paid a 13% premium to Enfusion’s stock price as of Jan. 10, was a wise one, pointing to Enfusion’s recent financial performance. Enfusion reported ~15% YoY growth in revenue to ~$201 million in 2024 and initial ~13% growth in YoY recurring revenue to ~$210 million.

Clearwater also sees Enfusion as a vehicle to build “a front-to-back platform for the entire investment management industry.” a press releaseClearwater says it plans to integrate Enfusion’s portfolio and order management technology into its offerings, while also expanding the hedge fund industries and geographies where Enfusion already has a presence.

Launched in 2004, Clearwater claims to have more than $7.4 trillion in assets on its platform. Notable clients include JP Morgan Asset Management, Facebook, Cisco and Oracle.