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Transactions

August 2011
London, United Kingdom
has been acquired by
Toronto, Canada


Background

Atrium Network (“Atrium” or the “Company”) is venture-backed company that offers a very high speed, low-latency, reliable, venue-neutral, infrastructure to connect its clients, primarily financial institutions, with approximately 24 exchanges, clearing houses, settlement depositories and other technology suppliers and trading venues in Europe and North America – including NYSE Euronext, Nasdaq OMX, CME Group and Chi-X Europe – and 300 sources of data in more than 11 countries.  The Company, domiciled in Luxembourg with most of its staff in London, and New York was founded July 2006 by two French men in an effort to create a better high-speed market infrastructure than the one they had helped to develop when both were employed by BT Radianz.  The solution they envisioned and built includes the telecommunications network and data feed handlers as well as associated required services such as co-location hosting and performance monitoring systems.  By early 2010, Atrium had more than 150 clients including banks hedge funds, high-frequency traders and other institutional investors on its own Financial Community Extranet that had points-of-presence in 19 locations across three continents.



Overview

In mid-2010, the founders approached M&A and asked for financial and strategic guidance as they considered a variety of options including a sale of the Company or raising growth capital.  Marlin & Associates organized a team to work with Atrium’s management and it’s Board in an effort to present the firm in the best light to multiple constituencies.  The team led preparations for due-diligence reviews; identified key strengths and weaknesses, and worked with the Company to strengthen those weaknesses before presenting to outside parties.

M&A then helped the owners and Management conduct a disciplined process that identified and then focused on discussions with a select group of potential partners.  The process ultimately generated multiple indications of interest from financial sponsors interested in making minority and majority investments as well as from strategic firms interested in outright acquisition.  For several months, the path seemed to be heading to investment by a third party that also would take over some of Atrium’s wide spread geographic operations.  But ultimately, the owners were presented with a more attractive offer to join with TMX Group (TSX: X), Canada’s leading stock exchange operator, to help them build out a global technology infrastructure.

In June 2011, nearly a year after the process started, the owners completed the sale of the Company to TMX, during the same period TMX was entering into strategic / merger discussions with the London Stock Exchange and the Maple Group, a consortium of Canadian financial firms.   Atrium management joined TMX to help build out the exchanges’ technology offerings.   The acquisition of Atrium has allowed TMX to strengthen its technology, its management team and its European presence and put it in a better position to expand its TMX Datalink offerings in Europe and the United States.

M&A Role

Marlin & Associates managed the process, assisted in the negotiations and acted as exclusive strategic and financial advisor to Atrium Network.

Press

TMX Group Acquires Atrium Network

August 04, 2011

August 3, 2011 (TORONTO) - TMX Group Inc., Canada's leading operator of exchanges and related services, today announced that it has acquired Atrium Network, a leading provider of high availability, cost effective, low latency network solutions in Europe and North America. Atrium Network, which will be rebranded TMX Atrium, will operate as a unit of TMX Datalinx™, TMX Group's information services division.
 
Both Atrium Network and TMX Datalinx provide capital markets data and connectivity solutions to the global financial services community. Atrium Network's existing North American, European and trans-Atlantic connectivity platform covers the service areas that TMX Datalinx planned to build out with its TMXnet™ network. In early 2011, TMX Datalinx introduced TMXnet, and in June 2011, the TMXnet network was expanded into key U.S. financial centres.

"Atrium Network extends our connectivity solutions into Europe and expands our U.S. presence significantly ahead of schedule," said Eric Sinclair, President, TMX Datalinx and Group Head of Information Services. "We are very excited about the opportunity TMX Atrium presents. Our combined network will offer 25 points of presence in 11 countries, 24 trading venues and 300 data sources with plans to expand in the future where our clients need us."
 
The combined connectivity and access points offer even greater value to current TMX Datalinx clients while increasing opportunities to offer capital markets connectivity solutions to a much broader audience. Atrium Network clients will benefit from TMX Datalinx's global content strategy as well as its plans to provide access to all key marketplaces. The acquisition also enables the company to add additional content from market centres in Europe and North America.
 
"This is an important development for our companies and for our respective clients," added Emmanuel Carjat, Chief Executive Officer of Atrium Network. "The complementary capabilities offered by Atrium Network and TMX Datalinx will enable our current and future clients to benefit significantly from additional data content and from enhanced access to trading solutions. TMX Atrium will continue to provide a neutral platform to facilitate communication within the global financial markets."
 
The global connectivity footprint that Atrium Network offers will also provide a new channel for order flow into Toronto Stock Exchange, TSX Venture Exchange and Montreal Exchange.

Marlin & Associates acted as exclusive strategic and financial advisor to Atrium Network.

The terms of the agreement are not material. Atrium Network employs 21 people, most of whom are based in London.
 
About TMX Group (TSX-X)
 
TMX Group's key subsidiaries operate cash and derivative markets for multiple asset classes including equities, fixed income and energy. Toronto Stock Exchange, TSX Venture Exchange, Montreal Exchange, Canadian Derivatives Clearing Corporation, Natural Gas Exchange, Boston Options Exchange (BOX), Shorcan, Shorcan Energy, Equicom and other TMX Group companies provide listing markets, trading markets, clearing facilities, data products and other services to the global financial community. TMX Group is headquartered in Toronto and operates offices across Canada (Montreal, Calgary and Vancouver), in key U.S. markets (Houston, Boston and Chicago) as well as in London. For more information about TMX Group, visit our website at www.tmx.com.
 
About Atrium Network
 
Atrium Network™ provides smarter connectivity solutions for the financial community.
Atrium Network offers client and industry connectivity via its extranet services (a single point of access to exchanges, MTFs, ECNs, clearing houses, CSDs, brokers and market data providers), as well as corporate technology (internet and intranet solutions). With a focus on reducing complexity and improving operational excellence, Atrium Network provides a range of innovative access options and the ability to self-provision.
 
Atrium Network is the market leader in providing an ultra-low latency connectivity solution to multiple trading venues. Their 'Exchange Ring' offers a fabric of dark fibre connectivity to each of the main liquidity venues and is designed to mitigate the risk of any unnecessary co-location investment and ensure lowest possible latency access to all available trading venues.

In September 2009 Atrium Network was awarded 'Best New Vendor' at Financial News' European Awards for IT Excellence and in November 2009, was recognised as a leading innovator by Financial News in its annual Tech21 list of technology firms.
 
Atrium Network currently has a presence in Europe, North America and South America. Atrium Network is headquartered in Luxembourg with offices in London, New York and Paris. For more information, please view Atrium Network's website at www.atriumnetwork.com.
 
About Marlin & Associates

Marlin & Associates Holding LLC is a boutique investment banking and strategic advisory firm specializing in acquisitions and divestitures of U.S. and international middle-market firms that provide technology, digital information and healthcare-related products, technology and services. The firm is headquartered in New York, NY and has additional offices in Washington, DC; Toronto, Canada; and Hong Kong, China.

Marlin & Associates Securities LLC, a wholly owned subsidiary of Marlin & Associates Holding LLC, is a broker-dealer registered with the Securities and Exchange Commission and is a FINRA/SIPC member firm (www.finra.org). Investment banking and/or securities are offered through Marlin & Associates Securities LLC.

Marlin has been the recipient of numerous awards, including twice being named "Middle-Market Investment Banking Firm of the Year," as well as the "Middle-Market Financing Agent of the Year -- Equity," and has been recognized for leading multiple "Deals-of-the-Year" Awards including: the "Financial Technology Deal of the Year," the "International Cross-Border Deal of the Year," and the "Middle-Market Financing -- Computer, Technology and Telecommunications Deal of the Year." 
 
Marlin's team of professionals have advised on more than 200 transactions involving companies that provide information and technology to a wide range of communities including those that serve the banking, capital markets, insurance, marketing and healthcare arenas. Recent Marlin & Associates clients include Photolibrary Group (Sydney, Australia); Subserveo (Vancouver, Canada); iSuppli (El Segundo, California); Qatarlyst (Doha, Qatar); SWIFT (Brussels, Belgium); NaviNet (Cambridge, Massachusetts); Deutsche Börse, and NYSE Euronext as well as a large array of firms owned by entrepreneurs, corporations, private equity and venture capital firms worldwide. Further information can be read at www.MarlinLLC.com.


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