Markit Ltd.

Markit Ltd.
Name	Markit Ltd.
Type	Private
Founded	2003
Fate	Merged into IHS Markit (2016)
Industry	Financial services
Headquarters	London, United Kingdom
Key people	Tom Glocer, Henry Paulson, Lawrence Fink
Products	Financial information, valuation, indices, risk services
Num employees	4,000 (2015)

Markit Ltd. was a London-based financial information and services company founded in 2003 that specialized in pricing, reference data, valuation, indices, and trade processing for the financial services industry. It grew quickly by aggregating market data and creating standardized benchmarks used by banks, asset managers, insurers, and governmental entities such as the Bank of England, Federal Reserve, and European Central Bank. In 2016 it merged with IHS Inc. to form IHS Markit, becoming a significant component of global financial markets infrastructure.

History

Markit Ltd. was established in the early 21st century by a management team that included executives connected to firms such as Barclays, Credit Suisse, and J.P. Morgan. The company expanded through organic growth and strategic acquisitions, interacting with institutions like Deutsche Bank, Goldman Sachs, and Morgan Stanley as both clients and collaborators. Notable milestones included the launch of fixed-income pricing services and credit derivatives valuation tools that attracted participation from International Monetary Fund researchers and practitioners at the Bank for International Settlements. In 2014–2016, discussions and negotiations with companies including IHS Inc. culminated in a 2016 merger, a transaction scrutinized by competition authorities such as the Competition and Markets Authority and regulatory bodies in the United States and European Union.

Business Operations

Markit operated across multiple global financial centers including London, New York City, Hong Kong, and Singapore, servicing clients ranging from sell-side institutions like UBS and Credit Suisse to buy-side firms including BlackRock and Vanguard. Its operational model combined data aggregation, vendor-managed data services, and hosted processing platforms used by sovereign entities such as the U.S. Treasury in addition to supranational bodies like the World Bank. The firm employed teams with expertise drawn from Bloomberg L.P. alumni, compliance professionals familiar with Dodd–Frank Wall Street Reform and Consumer Protection Act, and technologists versed in SWIFT messaging standards and ISO 20022 initiatives.

Products and Services

Markit's core offerings encompassed pricing and valuation services for instruments traded in venues such as London Stock Exchange and New York Stock Exchange, benchmark index creation comparable to work by MSCI and S&P Global, and post-trade processing akin to services provided by Euroclear and Depository Trust & Clearing Corporation. Specific products included credit default swap (CDS) indices referenced by market participants who also trade products on platforms like ICE and CME Group; synthetic collateralized debt obligation valuation used alongside models popularized by firms such as Moody's and Fitch Ratings; and corporate actions and reference data services competing with offerings from Refinitiv. Markit also developed workflow solutions for regulatory reporting to exchanges such as NASDAQ and systems used by clearinghouses including LCH.

Corporate Governance and Ownership

Markit's board and executive leadership drew figures from established institutions including former executives associated with Citigroup, HSBC, and The Carlyle Group. Institutional investors in various financing rounds included private equity and strategic investors comparable to KKR and Silver Lake Partners, while subsequent ownership stakes before the IHS merger involved shareholders from Blackstone-like entities and sovereign wealth funds analogous to Government Pension Fund of Norway. Governance practices were influenced by regulatory frameworks overseen by authorities such as the Financial Conduct Authority and the Securities and Exchange Commission.

Financial Performance

Markit reported rapid revenue growth in the years leading up to its merger, driven by recurring-subscription models and growth in derivatives and fixed-income markets, with financial metrics evaluated by analysts from banks including Deutsche Bank and Barclays Capital. Revenue streams were diversified across data licensing, index licensing comparable to FTSE Russell arrangements, and managed services contracts with institutions like AXA and Allianz. The company’s valuation and multiples were debated during merger talks with IHS Inc. and assessed by advisory firms in the vein of PricewaterhouseCoopers and Ernst & Young.

Legal Issues and Controversies

Markit faced scrutiny over aspects of pricing methodology and potential conflicts of interest that echoed broader industry debates involving entities such as Libor benchmark controversies and litigation seen in cases involving Royal Bank of Scotland. Regulators and plaintiffs referenced standards similar to those applied by the Commodity Futures Trading Commission and civil actions in jurisdictions where market data integrity was contested. The firm engaged in settlements and cooperative remediation in some disputes while defending methodologies in proceedings connected to authoritative bodies including national courts and arbitration panels.

Legacy and Impact on Financial Markets

Markit's legacy lies in standardizing valuation and reference data practices that influenced infrastructure providers like Bloomberg L.P. and Refinitiv and in supporting regulatory reporting frameworks associated with Basel III implementation and MiFID II compliance. Its indices and pricing services became embedded in risk management and portfolio valuation workflows used by asset managers such as Fidelity Investments and pension funds resembling CalPERS. The 2016 merger that produced IHS Markit further integrated Markit’s capabilities with economic and industry data assets, affecting market participants including exchanges like NYSE and research organizations akin to Oxford Economics.

Category:Financial services companies Category:Companies established in 2003 Category:Companies based in London