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Morningstar to Acquire Equity Research and Data Business of C.P.M.S. (Computerized Portfolio Management Services), Leading Provider to Canadian Investment Community
Editorial & Research Team, Morningstar Asia Ltd. 2009-04-27

Morningstar Research Inc., the Canadian subsidiary of Morningstar, Inc. (NASDAQ: MORN), has entered into a definitive agreement to acquire the equity research and data business of C.P.M.S. (Computerized Portfolio Management Services) Inc., a privately owned independent equity research and data firm in Toronto, for C$16.1 million. The companies expect to complete the transaction in the second quarter, subject to customary closing conditions.

 “C.P.M.S. is a highly regarded firm with a long history of providing superior equity data and research to the Canadian investment community,” said Scott Mackenzie, president and chief executive officer of Morningstar Research Inc. “Most investment managers in Canada use C.P.M.S.’ equity research and data, and Morningstar is a leading provider of fund research and data in the United States and Canada. By acquiring this business, we’ll be able to expand our global investment data and research offerings.”

Founded in 1984, C.P.M.S. tracks fundamental equity data for approximately 4,000 securities in the United States and Canada as well as tracks and provides brokerage earnings estimates for Canadian equities. C.P.M.S.’ flagship software platform, the Equity Market Service, fully integrates fundamental and expected earnings data to generate a wide range of applications such as stock, industry, and market analysis; construction of long and short strategies with its proprietary ranking and screening system; stock and portfolio sensitivity analysis; and portfolio analytics. Its Backtest service incorporates real-time fundamental and expected earnings data for developing and back-testing investment strategies and style analysis, as well as developing custom benchmarks. The Backtest service also permits industry and market behavior analysis.

C.P.M.S.’ equity research and data business also includes eight distinct quantitatively driven model portfolios covering value, growth, income generating, momentum, and short-selling investment styles for the U.S. and Canadian equity markets.

Rick Przybylski, founder, president and chief executive officer of C.P.M.S., said, “As part of our long-term goals and objectives, we’ve always looked to expand our presence outside of Canada. Morningstar’s global fundamental database, distribution network, and reputation will provide opportunities to enhance our equity research and data business and expand our client base.”

C.P.M.S.’ equity research and data business has more than 500 clients throughout the United States and Canada, including institutional money managers, pension funds, endowment managers, and investment advisors. It has about 40 employees in Toronto.

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yt.kum@morningstar.com