Morningstar Enters Into Agreement to Acquire Realpoint

In an announcement Friday, ""Morningstar, Inc."":http://corporate.morningstar.com/US/asp/home.aspx?xmlfile=202.xml&pgid=hetopcompsite, a Chicago-based provider of independent investment research, said it has entered into a definitive agreement to acquire Horsham, Pennsylvania-based ""Realpoint, LLC"":https://www.realpoint.com/RPLogin.aspx, a nationally recognized statistical ratings organization that specializes in structured finance.

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""We believe there's strong demand for unbiased ratings and research in the structured credit market, and we think the time is ripe to bring more competition to this market,"" said Joe Mansueto, chairman and CEO of Morningstar. ""This acquisition also builds on our recent entry into corporate credit ratings.""

Morningstar announced its entry into credit ratings on December 2, 2009, and now publishes ratings on approximately 150 of the largest U.S. companies. Its corporate credit rating business and pending acquisition of Realpoint support one of the company's growth strategies, which is to continue building through leadership in independent investment research.

""Realpoint has earned the respect of investors, and has built a solid business by being a reliable source for structured finance ratings and analysis,"" Mansueto said. ""Realpoint and Morningstar share a strong commitment to investors. Together, we want to restore credibility to the credit ratings business and be a positive force in rating structured products.""

Realpoint, which had revenue of approximately $12 million in 2009, currently offers securities ratings, research, surveillance services, and data to help investors identify credit risk in commercial mortgage-backed securities (CMBS). More than 225 institutional investment firms subscribe to Realpoint's trusted ratings and analytics, including the majority of money managers who invest in CMBS.

""Becoming part of a well-respected firm like Morningstar will give us the resources to expand our business on a global level, with a company that is equally focused on transparency and reliable ratings and analysis,"" said Robert Dobilas, CEO of Realpoint. ""At a time when market uncertainty is unprecedented, Morningstar's acquisition of Realpoint demonstrates a firm commitment to re-establishing faith in structured finance ratings.""

The transaction is expected to be completed in the next few months for the purchase price of $52 million, including approximately $42 million in cash and $10 million in restricted stock. Once the acquisition is completed, Realpoint will become a business unit of Morningstar, and over time, the company will be rebranded as Morningstar. Dobilas will continue to run the business, and the company will retain its offices in Pennsylvania.