Exclusive-SIX Group CEO rules out Allfunds bid amid M&A hunt

By Pablo Mayo Cerqueiro

LONDON (Reuters) -SIX Group has ruled out making a bid for fund distribution group Allfunds after studying an acquisition, and will instead consider other deals that can expand its data business or give it access to new asset classes, its CEO Jos Dijsselhof told Reuters.

"We don't think that's something for us," Dijsselhof said in an interview on Wednesday when asked about Allfunds. "We've also had a look at it, but not our cup of tea."

The comments come two months after Reuters reported that SIX, the operator of the Swiss and Spanish stock exchanges, was in the early stages of exploring a takeover of Amsterdam-listed Allfunds. Allfunds shares fell 2.4% after the Reuters report Thursday.

Dijsselhof said SIX is in contact with private equity firms, including Allfunds' largest shareholder Hellman & Friedman, as it continuously scans the market for possible acquisitions.

The Zurich-headquartered group is less interested in acquiring other European stock exchanges, Dijsselhof, who has led the company since 2018, said.

"If we could somehow get into derivatives or do something with other asset classes, perhaps even foreign exchange...that might be of interest," he said.

"Probably a data acquisition would actually have a higher priority than another exchange acquisition."

SIX generated more than 1.5 billion Swiss francs ($1.66 billion) of operating income last year, with data the second-largest revenue contributor at more than 400 million francs.

Dijsselhof said he hoped the group would at least double its overall revenue, as well as that of the financial information unit, over the next five years.

He also said he would like to further grow its domestic payments business, including through acquisitions.

"Our diversified portfolio I think is a real strength of SIX Group, which not many other exchange groups actually have," he said.

Unlike other market infrastructure groups, SIX's shares are not traded publicly, meaning it has fewer options to finance deals.

The group could turn to its around 120 bank shareholders for cash and even consider going public down the line if it wanted to pursue more transformational deals, Dijsselhof said.

However, he said there are no plans on the horizon for the bourse operator to change its ownership structure, nor has it been in a position where it has scrambled for money to pay for a deal.

SIX Group had prepared an offer for Borsa Italiana, the operator of the Milan Stock Exchange, when its then-owner the London Stock Exchange Group put it up for sale, Dijsselhof revealed.

Paris-headquartered Euronext ended up buying the asset in 2021 for more than 4 billion euros ($4.33 billion).

($1 = 0.9056 Swiss francs)

($1 = 0.9243 euros)

(Reporting by Pablo Mayo Cerqueiro in London. Editing by Anousha Sakoui and Elaine Hardcastle, Kirsten Donovan)