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

Clearwater Analytics, a company developing accounting, compliance and risk reporting tools for asset managers, said On Monday it entered into a definitive agreement to acquire investment management platform Enfusion for $1.5 billion.

Clearwater, which said it has borrowed $800 million to fund the transaction, along with a $200 million revolving line of credit, will let Enfusion’s shareholders elect to receive cash, stock or a mix. Clearwater Infusion expects to issue $760 million in cash and approximately 23 million to 28 million new shares to shareholders.

Both companies’ boards have agreed to the terms. If Enfusion’s shareholders and regulators approve it, Clearwater expects the deal to close in Q2 2025.

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

Enfusion has raised several million dollars in venture capital from investors including Iconic Growth and FTV Capital, which owns 45% of the company along with Enfusion CEO Oleg Movchan. After going public in 2021, Enfusion was valuable At $1.9 billion.

Clearwater contends that its purchase, for which it is paying a 13% premium over Enfusion’s stock price as of Jan. 10, is a smart move, pointing to Enfusion’s recent financial situation. Enfusion reported preliminary ~15% year-over-year growth in revenue to ~$201 million in 2024, and preliminary ~13% year-over-year growth in annualized recurring revenue to ~$210 million.

Clearwater also sees Enfusion as a way 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 expanding into hedge fund industries and geographies where Enfusion already has a presence.

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