Singapore Exchange will acquire a 93% stake in smart beta index provider Scientific Beta in a €186 million ($207 million) deal, subject to closing adjustments.
The acquisition will be funded through "external borrowings" and SGX does not expect the purchase to have any material impact on its fiscal-year 2020 financial results, according to a joint news release from the firms Thursday.
The EDHEC-Risk Institute launched Singapore-based smart-beta platform ERI Scientific Beta in April 2013. According to the news release, more than 60 asset owners and money managers had a total of $54.7 billion in assets under management replicating Scientific Beta's indexes as of Sept. 30.
SGX will maintain the collaboration with EDHEC Business School and Scientific Beta's management team, led by CEO Noel Amenc, will remain in place, according to the news release.
"The acquisition of Scientific Beta marks an important step in the evolution of our index business. Scientific Beta brings a highly regarded research pedigree in the rapidly growing smart beta space, along with a strong suite of high profile clients in the U.S. and Europe," said Loh Boon Chye, CEO of Singapore Exchange, in the news release.
Officials at SGX and Scientific Beta could not be immediately reached for comment.