Acquisitions and Divestitures

12 Months Ended

Dec. 31, 2019

Business Combinations [Abstract]

Acquisitions and Divestitures

Acquisitions and Divestitures

Acquisitions

Company	Acquisition Date	Primary Segment	Description
Simplifile, LC, or Simplifile	June 12, 2019	Trading and Clearing	Simplifile offers an array of mortgage services, primarily serving as an electronic liaison between lenders, settlement agents and county recording offices, streamlining the local recording of residential mortgage transactions. The transaction expands the ICE Mortgage Services portfolio, which includes MERS. See below for the Simplifile purchase price allocation.

Company	Acquisition Date	Primary Segment	Description
MERSCORP Holdings, Inc., or MERS	October 3, 2018	Trading and Clearing	MERS was previously a privately held, member-based organization that owned and managed the MERS System, made up of lenders, servicers, sub-servicers, investors and government institutions. MERS is now part of ICE Mortgage Services. Further disclosures and details on our acquisition of MERS is discussed below.
TMC Bonds, LLC, or TMC Bonds	July 23, 2018	Trading and Clearing	TMC Bonds is an electronic fixed income marketplace, supporting anonymous trading across multiple protocols in various asset classes, including municipals, corporates, treasuries, agencies and certificates of deposit. See below for the TMC Bonds purchase price allocation.
CHX Holdings, Inc., the parent company of the Chicago Stock Exchange, Inc., or CHX	July 18, 2018	Trading and Clearing	CHX, now named NYSE Chicago, is a full-service stock exchange including trading, data and corporate listings services. NYSE Chicago operates as a registered national securities exchange.
BondPoint	January 2, 2018	Trading and Clearing	BondPoint was acquired from Virtu Financial, Inc. and is a provider of electronic fixed income trading solutions for the buy-side and sell-side, offering access to centralized liquidity and automated trade execution services through its alternative trading system, or ATS. See below for the BondPoint purchase price allocation.
Bank of America Merrill Lynch, or BofAML’s, Global Research division’s index business, now named ICE BofA indices	October 20, 2017	Data and Listings	The ICE BofA indices are the second largest group of fixed income indices as measured by assets under management, or AUM, globally.
TMX Atrium	May 1, 2017	Data and Listings	TMX Atrium was acquired from TMX Group and is a global extranet and wireless services business, from TMX Group. TMX Atrium provides low-latency access to markets and market data across 12 countries, more than 30 major trading venues, and ultra-low latency wireless connectivity to access markets and market data in the Toronto, New Jersey and Chicago metro areas. The wireless assets consist of microwave and millimeter networks that transport market data and provide private bandwidth.
National Stock Exchange, Inc., now named NYSE National	January 31, 2017	Trading and Clearing	National Stock Exchange, Inc. gave the NYSE group of exchanges, or the NYSE Group, a new U.S. exchange license and is distinct from NYSE Group’s other listings exchanges because NYSE National is only a trading venue and not a listings market. NYSE Group’s other listings exchanges, NYSE, NYSE American, NYSE Arca and NYSE Chicago, have unique market models designed for corporate and ETF issuers. After closing the transaction, NYSE National ceased operations on February 1, 2017. NYSE National re-launched operations and commenced trading in May 2018.

During 2019, our consolidated subsidiary, Bakkt Holdings, LLC, or Bakkt, acquired two other companies which are not material to our operations.

Additional MERS Acquisition Considerations

In June 2016, we acquired a majority equity position in MERS and entered into a software development agreement to rebuild the MERS System, a national electronic registry that tracks the changes in servicing rights and beneficial ownership interests in U.S.-based mortgage loans. We treated the investment as an equity method investment since we did not have the ability to control the operations of MERS. On July 20, 2018, we exercised our option to purchase all of the remaining equity interests of MERS as a result of satisfying our deliverables under the software development agreement. On October 3, 2018, we completed the purchase of all remaining interests and, accordingly, own 100% of MERS. On that date, we gained control of MERS, began to include MERS's results as part of our consolidated operations, and recorded a $110 million gain on our initial investment value as other non-operating income.

Acquisition Purchase Prices and Allocation

The following summarizes our purchase price allocation for material acquisitions to the respective net tangible and identifiable intangible assets and liabilities based on their respective estimated fair values on the date of acquisition. For each acquisition, the excess of the purchase price over the net tangible and identifiable intangible assets has been recorded as goodwill. Cash consideration was gross of $12 million cash held by Simplifile and $15 million cash held by TMC Bonds on the date of each respective acquisition.

	Acquisition Purchase Price Allocation (dollars in millions)
	Simplifile (Preliminary)		Useful Life (Years)	TMC Bonds		Useful Life (Years)	BondPoint		Useful Life (Years)
Customer relationship intangibles	$	104	20	$	253	15	$	123	15
Developed technology intangibles	7		7	7		3	7		3
Trade name intangibles	2		5	—			—
Total identifiable intangible assets	113			260			130
Goodwill	218			423			267
Other working capital adjustments	7			17			3
Total purchase price cash consideration	$	338		$	700		$	400

Non-Controlling Interest

During 2017 we purchased both Gasunie’s 21% minority ownership interest in ICE Endex and ABN AMRO Clearing Bank N.V.’s 25% minority ownership interest in ICE Clear Netherlands. Subsequent to these acquisitions, we own 100% of ICE Endex and ICE Clear Netherlands and no longer include non-controlling interest for either company in our consolidated financial statements.

During 2017, we purchased 12.6% of the net profit sharing interest in our CDS clearing subsidiaries and in September 2018, we purchased an additional 3.2% interest. The remaining non-ICE limited partners in our CDS clearing subsidiaries hold a 26.7% ownership interest as of December 31, 2019.

In December 2018, Bakkt Holdings, LLC, or Bakkt, was capitalized with $183 million in initial funding by us as majority owner, along with a group of other minority investors. We hold a call option over these interests subject to certain terms. Similarly, the non-ICE partners in Bakkt hold a put option to require us to repurchase their interests subject to certain terms. These minority interests are reflected as redeemable non-controlling interests in temporary equity within our consolidated balance sheet.

Bakkt is an integrated platform that enables consumers and institutions to transact in digital assets. Bakkt was approved by the New York State Department of Financial Services to take custody of digital assets through Bakkt Trust Company, LLC, a qualified custodian. Bakkt Trust Company, LLC takes custody of bitcoin for physically-delivered futures, creating the first fully regulated marketplace for trading, clearing and custodial solutions of physically-delivered digital asset futures, and is supported by ICE Futures U.S. and ICE Clear U.S.

Divestiture of Trayport and the Acquisitions of Natural Gas Exchange Inc. and Shorcan Energy Brokers Inc.

In December 2015, we acquired 100% of Trayport for $620 million, in a stock transaction comprised of 12.6 million shares of our common stock. The CMA subsequently undertook a review of our acquisition of Trayport under the merger control laws of the U.K. and we were ultimately obligated to sell Trayport by January 2018. We sold Trayport to TMX Group in December 2017 for £550 million ($733 million). The gross proceeds included a combination of cash and in value relating to our acquisitions of Natural Gas Exchange, Inc., or NGX, now named ICE NGX, and Shorcan Energy Brokers Inc., or Shorcan Energy, from TMX Group. Shorcan Energy is now named CalRock Brokers, Inc., or CalRock. We recognized a net gain of $110 million in other income on the transaction. The net gain was equal to the $733 million in gross proceeds received less the adjusted carrying value of Trayport’s net assets of $607 million ($531 million carrying value plus $76 million in accumulated other comprehensive loss from foreign currency translation) less $16 million in disposition costs.

Trayport was included in our Data and Listings segment and ICE NGX and CalRock are primarily included in our Trading and Clearing segment. ICE NGX, headquartered in Calgary, provides electronic execution, central counterparty clearing and data services to the physical North American natural gas, electricity and oil markets. CalRock offers brokerage services for the North American crude oil markets. The ICE NGX and CalRock purchase price was allocated to their net tangible and identifiable intangible assets and liabilities based on their estimated fair values on the acquisition date. Our allocation to

identifiable intangible assets was $198 million, including $140 million for exchange registrations and licenses, which were assigned an indefinite useful life, and $53 million for customer relationship intangible assets, which were assigned useful lives of 20 years. The excess of the purchase price over the allocated net tangible and identifiable intangible asset value was $123 million and was recorded as goodwill.

Other Divestitures

On June 1, 2017, we sold NYSE Governance Services, a provider of governance, compliance, and education tools for organizations and their boards of directors, to Marlin Heritage, L.P. We recognized a net loss of $6 million on the divestiture of NYSE Governance Services, which was recorded as an impairment loss within our Data and Listings segment in the accompanying consolidated statements of income in 2017.

On March 31, 2017, we sold Interactive Data Managed Solutions, or IDMS, a unit of Interactive Data, to FactSet. IDMS is a managed solutions and portal provider for the global wealth management industry. There was no gain or loss recognized on the sale of IDMS.