Moody’s to acquire King of Prussia-based RDC for $700 million

Tom Paine

Regulatory Data Services (King of Prussia) announced today it was being acquired by Moody’s.

The price was $700 million, and Moody’s expects 2020 revenue to be $55 million. That’s a good price/sales ratio 0f 13:1, a bit higher than I would expect it to be. It indicates that better than average growth is expected.

RDC collects information from many different sources on both famous and infamous individuals and the organizations they are associated with. The key is to help financial institutions meet regulatory requirements for KYC (“know your customer”) and anti-money laundering. The terror threat and the financial crisis of the early 2000s resulted in much more onerous potential penalties for these events.

RDC was established in 2002 by a consortium of 20 of the world’s largest financial institutions. Vista Equity Partners, one of the largest tech PE firms, acquired RDC from Bain Capital Ventures in 2016 and was the seller today.

“RDC’s proprietary Global Regulatory Information Database (GRID) helps companies assess counterparties through a lens of more than 60 risk types by examining over 120,000 global sources, including adverse media coverage, politically exposed persons, government sanctions and regulatory watchlists. RDC’s platform incorporates industry-leading artificial intelligence (AI) for compliance screening to help process customer requests at greater speeds and accuracy while reducing false positives.”, Moody’s press release stated.

At Moody’s, RDC will be folded in with Bureau van Dijk, a 2017 acquisition that offers a similar product.

I knew Moody’s had great margins, but its current market value of $48.5 billion was a complete surprise to me.

Moody’s Analytics still has scores of people in West Chester, but its not clear if RDC will have anything to do with that business.

Tom Walsh is RDC’s CEO, and there is no mention in the press release of any forthcoming management changes. RDC has 544 employees according to LinkedIn.

Risk Intelligence Technology Leader RDC

Moody’s Acquires Risk Intelligence Technology Leader RDC

January 23, 2020 07:08 AM Eastern Standard Time

KING OF PRUSSIA, Pa.–(BUSINESS WIRE)–RDC, the global leader in risk intelligence compliance screening, announced today it has entered into a definitive agreement to be acquired by Moody’s Corporation (NYSE:MCO).

“Joining the Moody’s Analytics team is thrilling as it positions RDC to broaden our risk intelligence technology solutions as part of a leading provider of market and entity information and analytics to global financial institutions”Tweet this

The RDC acquisition positions Moody’s Analytics’ Bureau van Dijk (BvD), a leading provider of business intelligence and company data, to expand its range of data solutions, creating a global leader in anti-money laundering (AML) and know your customer (KYC) data and due diligence services. It will deepen Moody’s experience and expertise as a leader in financial and corporate reporting and analytics, by incorporating RDC’s world’s largest risk-relevant database and innovative technology, including the first-to-market true AI screening solution.

“Joining the Moody’s Analytics team is thrilling as it positions RDC to broaden our risk intelligence technology solutions as part of a leading provider of market and entity information and analytics to global financial institutions,” said RDC CEO Tom Walsh. “Joining BvD, under the Moody’s Analytics umbrella, will help us to expand and extend our artificial intelligence leadership position. It also enables us to re-double our mission of preventing criminal infiltration of the world’s financial system and bringing global transparency to areas of social responsibility such as human trafficking.”

Moody’s is an essential component of the global capital markets, providing credit ratings, research, tools and analysis that contribute to transparent and integrated financial markets. Moody’s is the parent company of Moody’s Analytics, which offers leading-edge software, advisory services and research for credit and economic analysis and financial risk management.

Moody’s will be acquiring RDC from Vista Equity Partners (Vista), a leading investment firm focused on enterprise software, data and technology-enabled businesses. Located in the greater Philadelphia area, RDC has been a part of the Vista portfolio since September of 2016. The compliance screening company provides anti-money laundering and reputational risk software that prevents criminal infiltration of the global financial system, working as an extension of its customers’ compliance and safety teams by providing precise risk alerts and ongoing monitoring for enhanced protection and performance.

The transaction is expected to close in the first quarter of 2020, subject to the satisfaction of customary closing conditions, including the expiration or termination of any applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976.

UBS Investment Bank served as financial advisor and Kirkland & Ellis LLP served as legal advisor to RDC and Vista Equity Partners.

About RDC

RDC, the Smarter Screening™ company prevents criminal infiltration of the world’s financial systems by delivering automated, intelligent customer screening and decision-ready intelligence. RDC supports more than 1,000 organizations and 35,000 compliance professionals across more than 100 countries in strengthening their KYC/AML, fraud and Politically Exposed Persons (PEPs) protection, ensuring sanctions and watchlist compliance, protecting their brand and reputation and managing supply chain and vendor risks. Founded by 20 of the world’s leading financial institutions, today RDC is a Vista Equity Partners portfolio company. Learn more about RDC by emailing info@rdc.com or visiting www.rdc.com.

Contacts

Press:

Terese Fernandez,
Global Head of Marketing
RDC
Office: +14846885164 | Mobile: +14843668226
tfernandez@rdc.com

RDC

NYSE:MCO 

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Contacts

Press:

Terese Fernandez,
Global Head of Marketing
RDC
Office: +14846885164 | Mobile: +14843668226
tfernandez@rdc.com

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