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Illustration: Aïda Amer/Axios

Intercontinental Exchange agreed to buy Ellie Mae, a Pleasanton, Calif.-based provider of mortgage finance software, from Thoma Bravo for $11 billion.

Why it matters: This is the largest acquisition ever for Intercontinental Exchange, as it only spent $8.2 billion to buy the New York Stock Exchange in 2012. It also pushes ICE much further into the mortgage finance market, following smaller deals for MERS (2016) and Simplifile (2019).

  • This is a quick and lucrative flip for Thoma Bravo, which last year took Ellie Mae private for $3.75 billion.
  • The $11 billion enterprise value is mostly debt. ICE will finance the deal via cash and stock, at an 84%/16% split, with expectations that it closes by year-end.

The bottom line: "Acquiring Ellie Mae would put ICE closer to the origination of home loans, expanding its reach to the mortgage lenders, brokers and other players that come together before a loan is closed. ICE’s current mortgage business is more focused on warehousing and processing data on home loans after they close," writes the Wall Street Journal.

Go deeper

Dion Rabouin, author of Markets
Sep 30, 2020 - Economy & Business

Lower rates, less risk

Expand chart
Data: St. Louis Federal Reserve; Chart: Axios Visuals

Perhaps more important than sustained demand, the mortgage financing landscape now is "very different from 2006," Danielle Hale, chief economist for Realtor.com tells Axios.

By the numbers: She cites metrics like the Mortgage Bankers Association's mortgage credit availability index, which found credit supply at its lowest level since March 2014 in August, and well below where it stood in 2006, at "over 800."

Philanthropy Deep Dive

Illustration: Aïda Amer/Axios

A look at how philanthropy is evolving (and why Dolly Parton deserves a Medal of Freedom).

Updated 6 hours ago - Politics & Policy

Coronavirus dashboard

Illustration: Aïda Amer/Axios

  1. Politics: Fauci says he accepted Biden's offer to be chief medical adviser "on the spot" — The recovery needs rocket fuel.
  2. Economy: U.S. economy adds 245,000 jobs in November as recovery slows — America's hidden depression: K-shaped recovery threatens Biden administration.
  3. Education: Devos extends federal student loan relief to Jan. 31
  4. States: New Mexico to allow hospitals to ration coronavirus medical care
  5. Vaccine: What vaccine trials still need to do.
  6. World: UN warns "2021 is literally going to be catastrophic"
  7. 🎧 Podcast: Former FDA chief Rob Califf on the vaccine approval process.