By Chris Kentouris
Complex event processing (CEP) technology providers Aleri and Coral8 have merged. Terms of the privately negotiated deal, which the companies are announcing today, have not been disclosed.
Aleri CEO Don DeLoach will head the combined company, which will retain the Aleri name and its Chicago headquarters. Terry Cunningham, chief executive of Mountain View, Calif.-based Coral8, will be chairman.
According to DeLoach, the companies have 80 customers, 60 of which are in the financial services industry. Although he noted that financial firms account for all of Aleris clients and half of Coral8s, DeLoach would not say how many each vendor is bringing to the table. While the Aleri product suite targeted business units solving a specific financial problem, Coral8 was more geared toward IT developers that wanted to adapt the use of SQL language for complex event processing, he explained.
Aleri and Coral8 are among a relatively small group of CEP specialists, which includes StreamBase Systems and Progress Software Corp.s Apama division. Commerzbank uses the Aleri platform for foreign exchange pricing, and Dexia Bank for liquidity management. Coral8 clients include Citigroup, which uses the technology for equity order flow analytics; block-trading platform Liquidnet for trade surveillance; and futures commission merchant Rosenthal Collins for risk management.
John Morrell, VP of product marketing at Coral8--he will hold the same position at Aleri-- also pointed to the companies different audiences. If a financial firms CEP project was handled by an internal programming team Coral8 would often be chosen, while Aleri was tapped by operations directors, said Morrell. For Aleri, the agreement will extend its reach into e-commerce, energy management and logistics.
The combined organization will have a better chance competing against horizontal players such as Microsoft, Oracle and Sybase, which are entering the financial services CEP space, said Adam Honoré, senior analyst at Boston-based Aite Group. He predicted that Aleri will make strides in fraud detection and unstructured data streams, areas that require rapid analysis.
In June, said Morrell, Aleri will introduce a real-time risk management module to monitor post-trade settlement failures, trade concentration and counterparty credit limits.
Founded in 1999, privately held Aleris decision to concentrate on event processing became evident in April when it sold its wholesale banking software division--built from its 2002 acquisition of software provider mpct Solutions--to Wall Street Systems. The companys flagship Aleri Streaming Platform launched in 2006, the same year that it began considering selling the banking unit, DeLoach told Securities Industry News at the time of the deal.
In December 2007, Aleri, which has offices in New York, Murray Hill, N.J., London and Paris, introduced its Market Liquidity Analysis (MLA) engine, which consolidates order books across multiple exchanges. Aleri announced in March 2008 that it had partnered with consultancy Lab49 on adding visualization capabilities to MLA.
Coral8, which started up in 2003, in November said it was increasing its focus on financial services and hired Colin Clark, previously VP of customers at StreamBase, as EVP of financial services. Michael DiStefano, former VP of architecture for financial services at infrastructure software company GemStone Systems, was given the same title at Coral8. Clark will not be joining the new company, said DeLoach; DiStefano will continue with Aleris financial sales team as director of strategic solutions reporting to Scott Jaffe, VP and general manager of North America.
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