Morningstar Purchases Market Data Vendor

Global research firm Morningstar has acquired U.K.-based Tenfore Systems, a privately owned provider of market data feeds and technology, for $20.9 million.

Tenfore, which will be rebranded under the Morningstar name, offers real-time distribution of consolidated data from over 160 global sources covering equities, commodities, derivatives, foreign exchange and indexes. Among its more than 500 clients are brokerages, buy-side firms, information and technology vendors, corporations and retail investors.

Calling the deal “an important strategic acquisition,” Joe Mansueto, chairman and CEO of Chicago-based Morningstar, said that “one large need investors have is getting real-time or even delayed quotes on securities. That’s an area we currently don’t have in our databases. … In many ways this is a perfect marriage of our fundamental data with a source for real-time stock quotes.”

Tenfore also supplies customers with a market data workstation and third-party application plug-ins, as well as analytics.

According to Mansueto, Morningstar plans to retain Tenfore’s approximately 50 staffers based in London, Frankfurt, Amsterdam and New York.

In a prepared statement, Tenfore CEO Gordon Bloor, who will stay on in the position, noted that “as a Morningstar company, we will be in a stronger competitive position.” Citing access to “a wider range of investment data” and a “significantly enhanced global distribution network,” Bloor added that the company anticipates “offering our clients real value in these difficult market conditions and beyond.” Tenfore’s investors were advised by Marlin & Associates New York on the transaction.

Morningstar, which estimates that the market for real-time data is around $1 billion a year, says the acquisition will greatly broaden the “scope, depth and timeliness” of its investment data while supporting its international growth strategy.

Catherine Gillis Odelbo, president of Morningstar’s individual business division, pointed to the benefits of Morningstar’s new ability to offer real-time quoting from sources around the world, while “Tenfore will be able to offer its clients a more powerful combination of data and research.”

For Morningstar, the deal follows its acquisition of 10-K Wizard, a Dallas-based provider of data-mining technology for company filings made through the Securities and Exchange Commission’s Edgar (Electronic Data Gathering, Analysis and Retrieval) reporting system. That purchase, for about $12.5 million, was announced Dec. 4.

In a statement, Martin Zacarias, CEO of 10-K Wizard, which has 25 employees and more than 30,000 users at 1,400 firms, cited “a common mission with Morningstar - gathering comprehensive data and information and combining it with robust technology and intuitive design to create tools that help people make better decisions. … As a Morningstar company, we will have access to a vast array of additional data and resources that will allow us to enhance our products for all of the market segments we serve.”

Liz Kirscher, president of Morningstar’s data services business, noted that the acquisition “aligns with our goal of bringing greater transparency to equity investments.”

10-K Wizard’s technology, said Kirscher, lets users “easily search and retrieve information across different filings and time periods” and can also be applied to other documents such as mutual fund prospectuses.