Commodities upstart ICE in $8bn takeover of New York Stock Exchange $8bn
Nikhil Kumar is The Independent's New York correspondent. He was formerly assistant editor on the foreign desk and has also done a variety of jobs on the city desk, where he wrote about markets, commodities and other business and economics topics.
Thursday 20 December 2012
Two centuries of independence for the New York Stock Exchange are set to come to an end after its operator, NYSE Euronext, agreed to sell itself to Inter-continentalExchange, the commodities-focused markets business, in an $8bn (£5bn) deal.
In all, the combined stock market behemoth will own 14 exchanges, along with five clearing houses, giving ICE the heft to go head to head with larger rivals such as CME, which runs derivatives and futures exchanges in New York and Chicago, and the Frankfurt-based Deutsche Börse, whose own gambit to join forces with NYSE Euronext was thwarted by European competition regulators.
The $8.2bn cash and stock deal values NYSE Euronext shares at $33.12 each.
While Deutsche Börse ran into a regulatory wall, ICE, which previously jointed with NYSE rival Nasdaq OMX in a failed hostile bid for the business, is expected to have no such problems, with analysts saying there is less of an overlap between the constituent businesses. ICE's bread and butter is commodities, while NYSE specialises in stocks and derivatives. The latter – NYSE's derivatives arm and in particular its London-based Liffe futures market – is seen as key to ICE's interest.
Also known as the Big Board, the Manhattan exchange is one of the central cogs of global capital markets and has been a mainstay of the Wall Street financial district for more than two centuries.
ICE, compared with the long and storied history of the NYSE, is a relative upstart, having been founded in 2000 in Atlanta. But its core business of commodity trading and energy futures has fared well thanks to the surge in demand for resources. Along the way, it has boosted itself with deals – for example, buying the London-based International Petroleum Exchange, home to Brent crude.
Euronext also operates exchanges in France, Belgium, Portugal and the Netherlands.
ICE's chief executive, Jeff Sportier, will be chief executive of the enlarged business, while the current head of NYSE Euronext, Duncan Niederauer, is to become president of the combined entity.
- 1 Howard Jacobson: Let's see the 'criticism' of Israel for what it really is
- 3 Belgium fan Axelle Despiegelaere lands L'Oreal campaign after World Cup viral photo
- 4 Britney Spears sings 'Alien' without Auto-Tune in embarrassingly brilliant leaked audio clip
- 5 PornHub begs users to stop uploading video clips of Brazil getting beaten 7-1
Game of Thrones author George RR Martin says 'f*** you' to fans who fear he will die before finishing Westeros saga
Instagram of US airport security chiefs: Lipstick knives and IED training kits among items seized
‘Ryan Gosling got someone pregnant and it's not me. Brazil you think you’re devastated…’
Israel-Palestine crisis: ‘We just want it to end… We don’t deserve to live like this’
Israel-Palestine crisis: Eight killed in Gaza Strip cafe while watching World Cup semi-final
Sustained immigration has not harmed Britons' employment, say government advisers
Australia facing international condemnation after turning around Sri Lankans at sea
7/7 memorial defaced on anniversary of 2005 attacks with ‘Blair lied thousands died’ graffiti
Even when it brutalises one of its own teenage citizens, America is helpless against Israel
There’s a nasty smell in the political air – and it’s coming from the Tories
Vanessa Feltz criticises 'vile' reaction to Rolf Harris allegations
iJobs Money & Business
£60000 - £75000 per annum: Harrington Starr: Business Analyst Consultant (Fina...
£60000 per annum: Harrington Starr: A leading provider in investment managemen...
£600 - £700 per day: Harrington Starr: AVS, JVS Openlink Endur Developer JVS, ...
£30000 per annum: Harrington Starr: A global leader in trading platforms and e...