It was reported Wednesday that Intercontinental Exchange Inc. (ICE) purchased Black Knight Inc. in a cash and stock transaction at a market value of $13.1 billion.
ICE is the same firm that purchased cloud-based platform Ellie Mae for $11 billion in August 2020, following a $335 million deal for Simplifile in 2019. ICE also took a majority stake of MERS in 2016, and purchased the company outright in 2018.
As noted in a LinkedIn post by Gabriel Skelton, Director of Banking and Mortgage Automation Solutions at OpenBots, "ICE already owns Encompass, the most commonly utilized loan origination system. Black Knight has a competing LOS called Empower. Additionally, Black Knight has one of the most popular loan servicing systems with their MSP product. Not to mention the ICE also owns the New York Stock Exchange. If this gets passed by regulators, what will this mean for the mortgage technology industry? Will ICE delve into Intelligent Document Processing, Robotic Process Automation or Artificial Intelligence next within their systems?”
According to MarketWatch, news of the merger drove the price of Black Knight shares up 18% to $75.17, as ICE agreed to buy the firm for $85 per share.
The addition of Black Knight’s tech solutions strengthens ICE’s growing mortgage technology business by increasing automation, while harnessing data that can help current homeowners lower their monthly payments, and lessen the likelihood of default.
"ICE buying Black Knight for $13bn is 🤯... Off the radar of mainstream fintech is where it's at,” said Eric Rachmel, CEO of end-to-end mortgage servicing platform Brace, in a Twitter post.
Based in Jacksonville, Florida, Black Knight employs approximately 6,500, and is a provider of an integrated ecosystem of software, data, and analytics solutions serving the real estate and housing finance markets.
Mike Brown, FinTech Exec, Consultant and Entrepreneur, took to LinkedIn and commented, “Wow, ICE acquires Black Knight. It will be interesting to see how having Empower and Encompass under one roof impacts the products and how they are marketed.”
The ICE-Black Knight transaction is expected to close in the first half of 2023, following the receipt of regulatory approvals, Black Knight stockholder approval, and the satisfaction of customary closing conditions.
Rick Grant, Co-Founder and COO at Content Beacon and President at RGA Public Relations, added via LinkedIn, "Well, this could change some things ... if the regulators approve it.”
Eric Lee, VP at Black Knight, was excited at news of the $13.1 billion deal, “Big news for ICE, Black Knight and our customers. Exciting things to come for everyone!” he wrote via LinkedIn.
Mac Chiles, SVP of Enterprise Sales at Black Knight, agreed with Lee's assessment, "Big news! Excited for all of the opportunities with Black Knight becoming part of ICE.”
In a release, Jeffrey C. Sprecher, Founder, Chair, and CEO of ICE, noted. “Black Knight shares our passion for leveraging technology to serve customers and households, and, with our expertise in operating networks and marketplaces, our planned acquisition will bring to life a true end-to-end solution for the mortgage manufacturing and servicing ecosystem, benefitting aspiring and current homeowners across the United States.”