ConvergEx, a trading-software company partially owned by Bank of New York Mellon, said its July agreement to be bought by CVC Capital Partners was terminated amid regulatory investigations of its Bermuda unit.
The parallel probes by the Securities and Exchange Commission and the Department of Justice mainly involve certain non-electronic trade-execution practices by the ConvergEx Global Markets unit, ConvergEx said Friday in a statement. The audit and risk committee of the board has hired outside counsel to conduct a thorough review, the company said.
“Since becoming aware of the matters under review, we have taken strong actions to remedy any lapses that have occurred,” Joseph Velli, chairman and CEO of ConvergEx, said in the statement. “We are taking additional steps to ensure that we are in full compliance with our own policies and procedures as well as all other regulatory requirements.”
John Nester, an SEC spokesman, declined to comment on the investigation.
CVC, a buyout firm that oversees a €10.8 billion ($14.1 billion) fund, would have become the largest owner of ConvergEx under the deal announced July 20. The buyout may have been valued at $1.9 billion, two people with knowledge of the talks said at the time.
ConvergEx, which sells software to handle trading and risk management, also functions as a broker-dealer. Its biggest competitors include Bloomberg LP, parent of Bloomberg News.