Standard Chartered Agrees to Acquire the Custody Business of Zodia Custody

Standard Chartered has agreed to acquire the custody business of digital asset custodian Zodia Custody. The deal was announced on the bank's press page on Monday.

Zodia Custody is a digital asset custodian backed by SC Ventures, Standard Chartered's innovation and investment arm. Under the terms disclosed, Zodia Custody's shareholders and noteholders have accepted a non-binding offer from Standard Chartered, with financial terms not disclosed to the market.

FROM SC VENTURES INCUBATION TO ACQUISITION

Standard Chartered said Zodia Custody's regulated custody activities would be integrated into its existing digital asset custody business within Financing and Securities Services, consolidating the group's digital asset custody businesses, while Zodia Custody's infrastructure platform will be separated into a new SC Ventures entity, Zodia Solutions.

According to the release, Zodia Custody serves institutional clients globally through bank-grade infrastructure and regulated custody solutions. Margaret Harwood-Jones, Global Head of Financing and Securities Services, said the acquisition would "accelerate the growth of Standard Chartered's global digital assets custody portfolio" and reflects the group's "continued focus on building an end-to-end Digital Assets offering".

The announcement did not disclose the purchase price or the balance-sheet treatment. Standard Chartered said the offer had been accepted by Zodia Custody's shareholders and noteholders adding that the move would drive value by unlocking revenue and cost synergies and that there was no expected disruption to clients, with existing Zodia Custody custody clients continuing to be serviced.

COMPLETION SUBJECT TO APPROVALS

Completion of the transaction is subject to regulatory approvals and customary closing conditions, according to the press release. The specific approvals required were not itemised.

SC Ventures chief executive Alex Manson said the deal reinforced the value of the SC Ventures model "in enabling the bank to participate in emerging ecosystems through scalable ventures and strategic partnerships".

"Digital asset custody is increasingly being delivered within banking environments," said Julian Sawyer, CEO of Zodia Custody.

The bank did not provide a specific timetable for completion.

Zodia Solutions, the new SC Ventures entity, will continue to provide bank-grade infrastructure to financial institutions, including Standard Chartered, and will be supported by a number of bank investors, including existing Zodia Custody investors, the bank said.