Newry-based FD Technologies has made a significant strategic move by agreeing to sell its consulting business, First Derivative, to the U.S. firm EPAM Systems for a remarkable £230 million.
First Derivative, known for its expertise in financial consulting, employs approximately 1,800 individuals across its global operations. This acquisition marks a pivotal moment for both companies, as it brings together First Derivative’s wealth of experience with EPAM Systems’ extensive resources and client base.
Transition to EPAM Systems
EPAM Systems, a Pennsylvania-based digital technology firm boasting around 65,000 employees, is set to integrate First Derivative into its portfolio. The deal represents the final stage in FD Technologies’ major restructuring efforts, aimed at streamlining operations and focusing on core competencies. It’s anticipated that EPAM will continue to operate First Derivative from its established offices in Newry and Belfast.
Balazs Fejes, President of EPAM’s global business, expressed enthusiasm about the acquisition, stating, “We’re pleased to expand our financial services portfolio and diversify our global footprint in key regions with the addition of First Derivative’s deep expertise across capital markets, banking operations, and asset servicing.” This collaboration promises to enhance EPAM’s offerings significantly.
A New Chapter for First Derivative
David Collins, Chief Executive of First Derivative, shared his excitement about the future, saying, “We are excited to continue our momentum by joining the EPAM team. Together, we are positioned to be the market-leading services provider with a highly differentiated capability, combining strong domain expertise and the best in modern technology.” The merger is expected to provide First Derivative with greater resources to innovate and serve its clients effectively.
The transaction is anticipated to close before the end of the year, with FD Technologies expected to receive approximately £205 million after expenses. This capital will be strategically allocated to pay off £20 million in debt, support the KX business plan, and return some profits to shareholders, although the exact amount to be distributed is still under review.
The Legacy of First Derivative
FD Technologies, formerly known as First Derivatives, is one of Northern Ireland’s most significant homegrown technology businesses. In March, the company announced a restructuring plan to sharpen its focus on the KX software division, which currently employs about 500 people and generates around £80 million annually. KX will remain headquartered in Newry and maintain its London stock market listing.
First Derivative was established in 1996 by the late Brian Conlon, and his family continues to hold significant shares in the business. This sale not only marks a turning point for FD Technologies but also sets the stage for new opportunities for growth and innovation in the rapidly evolving tech landscape.
