© Reuters. FILE PHOTO: A screen displays the Black Knight logo on the floor of the New York Stock Exchange (NYSE) in New York City, US, May 4, 2022. REUTERS/Brendan McDiarmid/File Photo
(Reuters) – US mortgage data firm Black Knight (NYSE:) will sell its Optimal Blue business for $700 million, shedding a second unit to allay regulatory concerns over a proposed acquisition by New York Stock Exchange owner Intercontinental Exchange (NYSE:).
Canadian business software company Constellation will buy the unit on the condition that ICE closes its acquisition, the two companies said Monday, sending Black Knight shares to a one-year high of $69.31.
Optimal Blue provides the data and technology for pricing and trading of mortgages.
Constellation also agreed to buy Black Knight Empower’s loan origination system business in March, a deal that analysts said may not be enough to allay concerns about ICE’s $11.7 billion proposal.
The FTC pledged in March to take action against the deal after some US lawmakers warned that the pricing power ICE would gain in the mortgage data market could drive up costs for consumers.
ICE and the Black Knight have both said they’re willing to go to court to salvage their deal, if necessary.
FTC Chairman Lina Khan’s tough stance on corporate mergers has made it difficult for companies to complete mergers without major concessions, but the agency has lost some high-profile court battles recently — including one against Microsoft’s (NASDAQ:) $69 billion bid. for Activision Blizzard (NASDAQ:).
The losses emboldened Khan’s critics, who attacked the FTC for being too aggressive and “deal-killing the boardroom”.