Chi-X Europe Stock Platform Gets Unsolicited Takeover Approach
Chi-X Europe Ltd., the trading platform started in 2007 to compete with London Stock Exchange Group Plc and Deutsche Boerse AG, said it was approached about a possible takeover by an unidentified bidder.
The pan-European electronic market received an “enquiry” from an unidentified suitor which might lead to an offer for the whole firm or a partial sale, Chi-X Europe said today in an e- mailed statement. It’s being reviewed by the board, according to the London-based multilateral trading facility.
“We must take into consideration the strategic interests of shareholders and stakeholders,” John Woodman, chairman of Chi-X Europe, said in the statement. “We were not seeking a transaction and the option of remaining independent would allow us to build further value for shareholders.”
Chi-X Europe, which traded almost 500 billion euros ($634 billion) of shares in the second quarter, competes with Bats Europe, owned by Bats Global Markets, as well as traditional exchanges such as New York-based Nasdaq OMX Group Inc., NYSE Euronext, LSE and Deutsche Boerse in Frankfurt. LSE in February completed the purchase of a majority stake in Turquoise, another electronic platform owned by a group of banks including Morgan Stanley, Credit Suisse, Bank of America Corp., Deutsche Bank AG and Goldman Sachs Group Inc.
Faster Trading
Chi-X Europe, which is partly owned by Instinet Inc., a New York-based unit of Nomura Holdings Inc., and by investment banks and traders including Zurich-based Credit Suisse Group AG, Getco LLC and Bank of America Corp., started trading in March 2007 and was the first platform to challenge traditional European bourses by offering lower fees and faster trading. Alasdair Haynes, who was named chief executive officer in 2009, said in February the company is generating profit and aims to become “the No. 1 exchange in Europe.”
“If a transaction happens, the buyer would be getting an established pan-European platform with a significant market share,” said Andrew Mitchell, exchange analyst Macquarie Group Ltd. in London.
Chi-X Europe has drawn 15 percent of trading in FTSE 100 Index stocks to date this year, compared with the LSE’s 41.5 percent. It has about 10 percent of Germany’s DAX Index, while Deutsche Boerse has 35 percent, according to the Bloomberg Fragmentation Score.
The number of trades on Chi-X Europe almost doubled in the second quarter to a record 72.1 million, from 37.1 million in the second quarter of 2009, the company said in July. The value of trades more than doubled to 482.3 billion euros from 209.5 billion euros in the comparable period a year ago. Dark trading, where prices aren’t publicly displayed, accounted for three percent of all activity.
To contact the reporter on this story: Nandini Sukumar in London at nsukumar@bloomberg.net
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