Reports CTRM Briefing Note – Allegro Development

CTRM Briefing Note Allegro Development September 2018 Overview Allegro Development (Allegro) is the oldest continuously operating ETRM/CTRM solutions provider in the world. Founded in 1984 by now chairman Eldon Klaassen, the company initially serviced the oil & gas producer market’s needs for a dedicated solution for tracking and managing commodity sales in the still highly regulated US energy markets. With deregulation of the US natural gas markets in the early 1990’s, the market for the company’s products grew rapidly. Despite a number of new solutions providers entering the market during that period, Allegro has consistently seen demand grow for its products across all energy commodities and markets, including expansion into the European and Asia Pacific regions. Currently the company maintains sales and support offices in 7 countries. Operating from their Dallas headquarters since the company’s founding, Allegro has grown primarily through organic growth, supplemented by two acquisitions: JustCommodity, a Singapore-based provider of CTRM for the global softs markets in 2015, and FEA, a US-based provider of risk analytics in 2018. Allegro is backed by private equity investors Vector Capital and Cerium. The company, post ION’s acquisition of Openlink, is now the largest independently operating vendor of CTRM solutions in the world - providing software internationally across many commodity markets, including crude oil, refined products, natural gas, natural gas liquids, liquefied natural gas, power, edible oils, rubber, and emissions - to more than 260 client companies. Recently, the company announced a development initiative to build out capabilities for the growing metals and metal concentrate markets as well. FEA Acquisition In April of 2018, Allegro announced it had acquired the Financial Engineering Associates’ (FEA) business unit from MSCI. FEA is an US-based provider of software and consulting services for advanced risk management and analytics. Originally founded in 1990, FEA’s solutions provide customers with global commodity trading financial analytics. FEA’s trade and portfolio analytic solutions provide a strategic fit with Allegro’s distribution channels, investment strategy, and extensible CTRM / ETRM software suite. As envisioned by the company, “the combined solution provides customers with commodity trading quantitative analytics that lead to better portfolio pricing, valuation, decision support, risk management and physical asset optimization.” With customers in more than 20 countries, FEA’s products cover thousands of different instruments and assets and provide customers the ability to model the breadth of their enterprise portfolios. At a Glance Company Background Founded: Chairman: CEO: Offices: Employees: Website: 1984 Eldon Klaassen Frank Brienzi Dallas TX, US London UK Singapore Calgary CA Dubai UAE Houston TX, US Jakarta ID Zurich CH 370 (Est.) Products Allegro Horizon Allegro Ags Allegro Analytics (FEA) Market Profile (ComTech Est.) Customers by Geography North America South America Europe Africa AsiaPac including Aust. 48% 1% 30% 1% 20% Customers by Market Segment Utilities Energy Retailers Banks/Financials Biofuels Energy Producers Refining/Petrochems Industrial Consumers 25% 18% 3% 12% 24% 12% 6% Financial Results Financial Results Though Allegro is privately held and does not publically disclose financial information, ComTech analysis indicates the company’s sales and revenue performance has exceeded that of the overall CTRM market over the last 5 years. Product Set and Technology Base Allegro is a privately held company and does not disclose financials. ComTech analysis indicates the company’s sales and revenue performance has exceeded that of the overall CTRM market over the last 5 years. Recently redesigned to be deployed in a modular configuration – in which customers pick and choose only those products they require – Allegro’s technology stack and architecture allows it to offer its solutions in a traditional on-premises model as well as via the cloud as hosted deployment. The company’s flagship product, Allegro Horizon is designed to help companies who buy, sell, produce or consume commodities better understand, manage and profit from their portfolio. With capabilities spanning credit, risk, logistics and real-time position visibility – and now with enhanced risk analytics provided by FEA, that provides customers with global commodity trading and quantitative analytics that better portfolio pricing, valuation, decision support, risk management, and © Commodity Technology Advisory llc September 2018 1