BMO Financial Group to Acquire Clearpool Group Inc.

New York and Toronto (ots/PRNewswire) - - BMO Financial Group (NYSE, TSX: BMO) today announced that it has entered into a definitive agreement to acquire Clearpool Group Inc., a New York-based provider of holistic electronic trading solutions and an independent agency broker-dealer operating in the U.S. and Canada. The transaction is subject to receipt of required regulatory approvals and other customary conditions and is currently expected to close in the calendar second quarter. Terms were not disclosed.

  • Fintech acquisition delivers modern, cloud-based electronic trading platform with visual data analytics and customizable algorithmic strategies
  • Emphasizes BMO's priorities to provide innovative technology to clients and expand in areas of opportunity and strength

The transaction delivers powerful new capabilities to BMO's electronic trading platform. As the nature of equity trading shifts to increased emphasis on electronic trading, the acquisition of Clearpool demonstrates BMO's commitment to delivering leading edge trading technology to its global client base.

Founded in 2014, Clearpool has approximately 60 employees and over 100 clients, primarily U.S. broker dealers who utilize the company's trading technology and execution services. Its Algorithmic Management System (AMS) provides a fully customizable suite of algorithmic trading tools designed to service the best execution needs of institutional clients. Clearpool is a 2019 Waters Rankings Winner - Best Algorithmic Trading Provider and a recipient of the 2019 Markets Choice Awards - Best Algorithmic Trading Company.

"BMO Capital Markets is accelerating on our strategic priorities of delivering exceptional client-experiences, driving an innovation mindset, activating a high performance culture and simplifying how we do business," said Dan Barclay, CEO, BMO Capital Markets. "The acquisition of Clearpool is consistent with these priorities as it gives us access to leading next-gen trading technology and a broker-dealer client base."

On closing, Clearpool will be a separate broker-dealer with information barriers to secure clients' confidential information.

"Clearpool's business was built on providing transparency and control to all market participants," said Aine O'Flynn, Managing Director and Head of Global Equity Products, BMO Capital Markets. "We are committed to maintaining those principles."

"We are very excited to join BMO," said Joseph Wald, CEO and Co-Founder, Clearpool. "The acquisition positions us well to accelerate the next step in our platform development and provide the infrastructure to become a global, multi-asset class electronic trading solution. None of this would be possible without our employees, clients, and advocates who continue to shape our vision of transparency and collaborative trading solutions."

Electronic trading is a rapidly growing portion of the global equity secondary commission/fee pool. A 2018 report by Greenwich Associates estimates that 73% of global equity flows are executed electronically and for more liquid developed markets, the rate is likely over 90%.

In connection with the transaction, BMO Capital Markets acted as financial advisor and Debevoise & Plimpton LLP and Osler, Hoskin & Harcourt LLP acted as legal counsel to BMO. Financial Technology Partners acted as financial advisor and Morgan, Lewis, & Bockius LLP, Murphy & McGonigle and Stikeman Elliott LLP acted as legal counsel to Clearpool.

About BMO Capital Markets

BMO Capital Markets is a leading, full-service North American-based financial services provider offering corporate, institutional and government clients access to a complete range of products and services including equity and debt underwriting, corporate lending and project financing, mergers and acquisitions advisory services, securitization, treasury management, market risk management, debt and equity research and institutional sales and trading. With approximately 2,700 professionals in 33 locations around the world, including 19 offices in North America, BMO Capital Markets works proactively with clients to provide innovative and integrated financial solutions.

BMO Capital Markets is a member of BMO Financial Group (NYSE, TSX: BMO) one of the largest diversified financial services providers in North America with $852 billion total assets as at October 31, 2019.

About Clearpool

Launched in 2014 and based in New York, Clearpool Group, Inc. offers holistic electronic trading solutions and provides independent agency broker-dealer execution services. With over 100 Algorithmic Management System (AMS) broker-dealer clients and executing approximately 2% of the US equity market volume, Clearpool empowers market participants to achieve better quality executions in an evolving equity market microstructure and competitive landscape.

Certain statements in this press release are forward-looking statements under the United States Private Securities Litigation Reform Act of 1995 (and are made pursuant to the 'safe harbour' provisions of such Act) and applicable Canadian securities legislation. These forward-looking statements include, but are not limited to, statements with respect to the expected closing of the proposed transaction, plans for the acquired business and the financial impact of the proposed transaction and are typically identified by words such as "believe", "expect", "anticipate", "intend", "estimate", "plan", "will", "should", "may", "could" and other similar expressions.

By their nature, forward-looking statements are based on various assumptions and are subject to inherent risks and uncertainties. We caution readers of this press release not to place undue reliance on our forward-looking statements as the assumptions underlying such statements may not turn out to be correct and a number of factors could cause actual future results, conditions, actions or events to differ materially from the targets, expectations, estimates or intentions expressed in the forward-looking statements. Such factors include, but are not limited to: the possibility that the proposed transaction does not close when expected or at all because required regulatory approvals and other conditions to closing are not received or satisfied on a timely basis or at all; the terms of the proposed transaction may need to be modified to satisfy such conditions; the anticipated benefits from the proposed transaction are not realized in the time frame anticipated or at all as a result of changes in general economic and market conditions, interest and exchange rates, monetary policy, laws and regulations (including changes to capital requirements) and their enforcement, and the degree of competition in the geographic and business areas in which Clearpool's business currently operates; the ability to promptly and effectively integrate Clearpool's business; reputational risks and the reaction of Clearpool's customers and employees to the transaction; diversion of management time on transaction-related issues; and those other factors set out on page 68 of BMO's 2019 Annual Report to Shareholders. We caution that the foregoing list is not exhaustive of all possible factors. These factors should be considered in addition to other uncertainties and potential events, and the inherent uncertainty of forward-looking statements.

BMO does not undertake to update any forward-looking statement, whether written or oral, that may be made, from time to time, by the organization or on its behalf, except as required by law.

BMO Media Contacts: Julie Smithers, Toronto, Julie.Smithers@bmo.com, (416) 643-9180

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