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Moody's Closes Intelligence Provider Bureau van Dijk Buyout

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Moody's Corporation (MCO - Free Report) has successfully completed the acquisition of Bureau van Dijk, thereby expanding its risk data and analytical insight capabilities. Amsterdam, Netherlands-based Bureau van Dijk is a global business intelligence and company information provider, which is owned by the fund EQT VI (part of EQT, an alternative investment firm).

The deal was announced on May 15, 2017 and received clearance under the EU Merger Regulation from the European Commission on Jul 28.

Moody’s projects the transaction to result in nearly $45 million of revenue and expense synergies annually by 2019 and $80 million by 2021, driven by elimination of overlapping data acquisition costs and streamlining product portfolio.

Also, it expects the deal to be accretive to its 2018 adjusted earnings (excluding purchase price amortization and one-time integration expenses) and 2019 GAAP earnings.

Following the announcement of the deal, Moody’s had also lowered its share repurchase authorization to $200 million for 2017 and 2018, but kept the dividend payout ratio target of 25–30% intact.

However, the company will provide an updated guidance for this year in its third-quarter 2017 earnings release, which will include the impact of Bureau van Dijk. Also, from now onward, Moody’s financials will include Bureau van Dijk’s operations.

Moody’s has been a successful acquirer. Over the years, the company increased scale and cross-selling opportunities across products and vertical markets through acquisitions. This deal is also in sync with its long-term strategy to strengthen its revenue base.

The company’s shares have risen 34.6% so far this year, significantly outperforming the 7.1% rally of the industry it belongs to.



Currently, Moody’s has a Zacks Rank #2 (Buy).

Some other stocks in the finance space worth a look include Carolina Financial Corporation (CARO - Free Report) , LendingClub Corporation (LC - Free Report) and On Deck Capital, Inc. (ONDK - Free Report) .

Carolina Financial witnessed an upward revision in its Zacks Consensus Estimate of 4.5% for the current year, over the past 60 days. Its share price has increased 3.5% year to date. The stock sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

LendingClub’s Zacks Consensus Estimate, which is a loss, has increased slightly for the current year, in the past 60 days. However, the stock, carrying a Zacks Rank #2, has risen 12.4% year to date.

On Deck Capital also carries a Zacks Rank #2 and its Zacks Consensus Estimate of a loss has remained stable over the past 60 days, for the current year. Its shares have gained 4.5% year to date.

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