Nasdaq to acquire Verafin for $2.75 bn; creating a global SaaS leader in financial crime management

By Pavithra R

Nasdaq has announced entering into a definitive agreement to acquire Verafin, a leading anti-financial crime management solution provider, for US$2.75 bn in cash, subject to customary adjustments.

Anti financial crime technology represents a large and growing sector with structural and regulatory tailwinds. Under the deal, Nasdaq will combine Verafin’s comprehensive suite of anti-financial crime management products with its reach and regulatory technology leadership to create a global SaaS leader in the fight against financial crime, a global problem that demands innovative action.

Founded in 2003, Verafin provides financial institutions in North America a cloud-based platform to help investigate, detect, and report money laundering and financial fraud. Its products leverages machine learning, robust shared data insights, visualization and investigation tools and are powered by intelligent analytics to increase detection accuracy and reduce costs for clients. The firm emphasizes on having a holistic approach to eradicate financial crime, and its platform supports a consortium of several large global banks as they collaborate to detect financial crimes to support law enforcement investigations.

“At the core of Nasdaq’s mission, we champion fairness and integrity in the markets that we build and in the broader financial ecosystem in which we operate, and combatting financial crime is central to achieving our goals. Verafin’s innovative fraud and AML detection platform, combined with Nasdaq’s leading trade and market surveillance solution, will empower Nasdaq to play an increasingly important role in building stronger economies around the world. The intelligent technology solutions Verafin has created are second-to-none, and that is evident in the company’s extraordinary growth and stellar client retention. Together with Verafin’s founders and employees, we look forward to building Nasdaq into a global leader in anti-financial crime management solutions. Additionally, we are committed to supporting innovation and growth in St. John’s and Newfoundland and Labrador. We believe that Verafin will not only complement and grow our existing presence in Canada, but also represents a potential catalyst for further investment opportunities in the province and the country,” said Adena Friedman, President and Chief Executive Officer, Nasdaq.

The acquisition is expected to strengthen Nasdaq’s existing regulatory technology and anti-financial crime solutions, which include its Nasdaq Trade and Market Surveillance offering, its Buy-side Compliance product, as well as the Nasdaq Automated Investigator for anti-money laundering (AML). Nasdaq’s deep relationships with leading global Tier 1 and Tier 2 banks will accelerate Verafin’s strategy of displacing legacy providers and manual processes with its cloud-based, state-of-the-art, market proven solution.

Nasdaq will retain Verafin’s executive leadership team and will continue to lead the company’s growth by increasing investment in Verafin’s research and development.

“This investment by Nasdaq, a global leader in financial technology, is a major vote of confidence and a significant win for the Province of Newfoundland and Labrador’s technology and innovation sector. Nasdaq’s clear commitments to the Province will help foster prosperity and opportunity throughout the community as we continue to grow our business. Since we began discussions with Nasdaq, we felt their DNA strongly mirrored our own core values: innovation, teamwork, entrepreneurship, and a commitment to continued growth and development. Together with Nasdaq, we will be a clear leader in expanding the fight against illicit finance by delivering our capabilities to a global client base from our headquarters in St. John’s,” said Jamie King, Chief Executive Officer, Verafin.

Established since 1971, Nasdaq is a global technology company serving the capital markets and other industries. According to company data, Nasdaq’s market technology powers 250 of the world’s market infrastructure organizations and market participants, including broker-dealers, clearinghouses, exchanges, central securities depositories and regulators, in over 50 countries with end-to-end, mission-critical technology solutions.