ATLANTA - Intercontinental Exchange, Inc. (NYSE:ICE), a prominent global provider of data and technology services with a market capitalization of $84 billion, has announced the complete acquisition of the American Financial Exchange (AFX), a key electronic platform for direct lending and borrowing among U.S. banks and financial institutions. The purchase of AFX from 7RIDGE was confirmed today, with ICE taking full ownership.
According to ICE, the acquisition is not projected to significantly impact its financial results for 2025, nor will it affect its plans for deleveraging and returning capital. The integration of AFX is seen as a strategic enhancement to ICE's existing mortgage technology network and global index business, with a shared customer base that includes regional, midsize, community, and minority-owned banks. According to InvestingPro data, ICE has demonstrated strong financial performance with revenue growth of 21.2% over the last twelve months and maintains a FAIR financial health score.
AFX is known for operating the American Interbank Offered Rate (AMERIBOR®), a daily benchmark rate based on unsecured interbank loans, which is used by a network of over 1,000 American banks and financial institutions. This rate is designed to reflect the actual borrowing costs of banks without collateral.
The acquisition aligns with ICE's mission to digitize the mortgage workflow ecosystem, aiming to reduce costs for lenders and borrowers. ICE has established a comprehensive network for managing the U.S. mortgage life cycle, from consumer acquisition to the secondary capital markets.
ICE's portfolio of services includes deeply liquid interest rate futures and options markets, along with a suite of over 5,000 global indices used for benchmarking and performance measurement by investors. As of September 2024, ICE managed approximately $670 billion in assets under management (AUM) in passively managed products, with around $2 trillion in AUM across both active and passive strategies. InvestingPro analysis shows the company has maintained dividend payments for 12 consecutive years, with a current dividend yield of 1.23%. Subscribers can access detailed financial analysis and 6 additional ProTips about ICE's market position and growth potential.
Christopher Edmonds, President of ICE Fixed Income and Data Services, expressed confidence in the acquisition, stating that AFX's integration into ICE would foster innovation and product development for the interbank lending market.
This move is part of ICE's broader efforts to transform and streamline various industries by connecting customers to opportunities through its digital networks, which include the New York Stock Exchange and other financial and environmental product markets. With an EBITDA of $5.56 billion in the last twelve months and analyst consensus suggesting strong growth potential, ICE continues to demonstrate its market leadership. For comprehensive analysis and detailed metrics, investors can access the full ICE Research Report on InvestingPro, which provides in-depth insights into the company's valuation and growth prospects.
The information provided in this article is based on a press release statement from Intercontinental Exchange.
In other recent news, Intercontinental Exchange (ICE) has been the subject of several analyst reviews. Citi analysts reiterated their Buy rating on ICE, citing its strong positioning in the energy sector and improvements in the Financial Data & Information Services (NASDAQ:III) outlook. On the other hand, TD Cowen revised its stock price target for ICE from $185.00 to $179.00 due to concerns about the International Money Transfer (IMT) segment and higher-than-expected expenses, but maintained a Buy rating. Analyst Patrick O'Shaughnessy at Raymond (NS:RYMD) James also maintained an Outperform rating on ICE shares.
ICE reported record third-quarter financial results for 2024, with net revenues of $2.3 billion, driven by transaction revenues of $1.1 billion and recurring revenues of $1.2 billion. Adjusted operating income also reached a record high of $1.4 billion. The company's energy market performed robustly, with cleaner energy revenues accounting for 45% of total energy revenues.
In other company news, the New York Stock Exchange, operated by ICE, announced it will halt trading across all its equity and options markets to observe the National Day of Mourning for former President Jimmy Carter. These are recent developments that reflect the current status and future projections for ICE.
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