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May 1st 2009

New Contract

Paladyne wins $30 billion administrator client

Admiral Administration, a hedge fund administrator with $30 billion under administration, has begun implementing Paladyne Systems' hosted product suite for use as its middle-office service platform. Admiral will also offer a range of Paladyne products to hedge fund clients through a white-labelling arrangement.

The Paladyne system integrates fully with Advent Geneva, Admiral's portfolio accounting system, facilitating more efficient internal operations; the administrator will also offer Paladyne's trading, portfolio management, P&L, and reporting capabilities to its clients.

Following the implementation period, Admiral's new middle-office service platform will include support for execution and order management, trade confirmation and settlement, counterparty reconciliation, pricing, reference data man-agement, and other functions.

According to both Admiral's head of business development Ben Perschick and Sameer Shalaby, Paladyne chief executive, the Paladyne implementation will yield both internal efficiencies and a competitive edge in attracting new clients via new technology offerings. "The industry is in turmoil, and Admiral has lost some assets, so we had to come up with a strategy either to increase our margins with our current clients or go out and attract new clients," explains Perschick. "It was obvious that our current service model was just going to keep us at our current asset level, so we had to go out and do something new. Part of that effort is this new service offering in the middle office, and making ourselves more efficient. In both cases this is where Paladyne comes in."

Perschick says Admiral's initial internal analysis shows that the price the administrator is paying for the Paladyne-hosted tools will be offset by new operational efficiencies and cost savings even before any new hedge fund clients sign on.

Admiral's white-labelled Paladyne offerings will be available to both existing and new hedge fund clients, but Perschick expects interest primarily from new, less technologically established clients.

"For the order management and portfolio master offering it will be a white-labelled product," he says. "A lot of our current clients won't even notice - for them we'll just be a lot more efficient behind the scenes. We'll need fewer bodies and we'll get things done faster."

Admiral plans to complete the implementation of the Paladyne system in late June, according to Perschick. >< 

Stewart Eisenhart

Bottom line: The ability to maximise internal operational efficiencies and offer Paladyne's front-office tools to clients should provide a substantial competitive benefit to Admiral.