ICE / Ellie Mae 2020
Intercontinental Exchange acquired Ellie Mae for $11B on August 6, 2020.
- Target
- Ellie Mae
- Acquirer
- Intercontinental Exchange
- Deal value
- $11B
- Deal type
- Mixed
- Announced
- August 6, 2020
- Sub-sector
- Capital Markets Tech
Transaction overview
- ICE announced the acquisition of Ellie Mae on August 6, 2020 for approximately $11 billion in cash.
- The deal closed on September 4, 2020, roughly four weeks after announcement.
- Ellie Mae operates Encompass, a cloud-based loan origination platform used by mortgage lenders and brokers.
- Ellie Mae processed roughly 40% of U.S. mortgage applications through its platform at the time of the deal.
- ICE acquired Ellie Mae from Thoma Bravo, which had taken the company private in 2019 for $3.7 billion.
- ICE sought to connect Ellie Mae's origination data with its Mortgage Electronic Registration Systems (MERS) and ICE Data Services assets.
- The $11 billion price represented a roughly 197% premium to Thoma Bravo's 2019 take-private valuation.
Why it matters
- The deal gave ICE a position spanning mortgage origination, registration, and data, covering a large portion of the U.S. home-loan workflow.
- At $11 billion, it ranked among the largest fintech acquisitions of 2020 and the largest in U.S. mortgage technology history at that time.
Strategic rationale
ICE buys mortgage origination software platform from Thoma Bravo to anchor its mortgage technology stack ahead of Black Knight acquisition three years later.
Deal terms & multiples
About Ellie Mae
Ellie Mae is a Pleasanton, California-based software company that provides loan origination and processing technology to U.S. mortgage lenders, banks, and brokers. Its flagship product, Encompass, automates compliance, underwriting, and closing workflows for residential mortgage origination. The company was founded in 1997 and went public on the NYSE in 2011 before Thoma Bravo took it private in April 2019 for $3.7 billion. At the time of the ICE acquisition, Ellie Mae's platform was used to process roughly 40% of U.S. mortgage applications annually.
- Founded
- 1997
- HQ
- United States
- Prior funding
- Taken private by Thoma Bravo in April 2019 for approximately $3.7 billion; previously publicly traded on NYSE
- Key metric
- ~40% of U.S. mortgage applications processed through Encompass annually
About Intercontinental Exchange NYSE: ICE
Intercontinental Exchange is an Atlanta-based operator of financial exchanges, clearinghouses, and data services, founded in 2000. ICE owns the New York Stock Exchange and operates futures and options markets across energy, agriculture, and financial products. The company has expanded into mortgage infrastructure through a series of acquisitions, including MERS in 2016 and Simplifile in 2019. ICE reported revenues of approximately $6 billion in 2020.
- Founded
- 2000
- Ticker
- NYSE: ICE
Frequently asked questions
How much did ICE pay for Ellie Mae?
ICE paid approximately $11 billion in cash. The seller was private equity firm Thoma Bravo.
When did the ICE acquisition of Ellie Mae close?
The deal closed on September 4, 2020, about four weeks after the August 6, 2020 announcement.
What does Ellie Mae do?
Ellie Mae provides mortgage loan origination software, primarily through its Encompass platform, used by U.S. lenders and brokers.
Why did ICE acquire Ellie Mae?
ICE wanted to connect origination data from Encompass with its existing mortgage infrastructure assets, including MERS and Simplifile.
Who owned Ellie Mae before ICE bought it?
Thoma Bravo took Ellie Mae private in April 2019 for $3.7 billion and sold it to ICE roughly 17 months later.
What premium did ICE pay over Thoma Bravo's purchase price?
ICE's $11 billion price was roughly 197% above the $3.7 billion Thoma Bravo paid in 2019.
Sources
- ir.theice.com /press/news-details/2020/Intercontinental-Exchange-Enters-Definitive-Agreement-to-Acquire-Ellie-Mae-from-Thoma-Bravo/default.aspx