BATS, Chi-X Europe Talk Merger

February 11, 2011

 

BATS Global Markets, a Kansas City, Mo.-based global financial markets technology company, is in talks with Chi-X Europe to acquire the European exchange in an exclusive negotiation that was first announced in December.

The deal would be one of a growing number of possible exchange mergers now in the works, include a potential London Stock Exchange-TMX Group transaction as well as a proposed NYSE Euronext-Deutsche Boerse combination. Such mergers hold the promise of cheaper and more efficient trading, industry sources have said.

BATS operates two U.S. stock exchanges—the BZX Exchange and the BYX Exchange—as well as equity options market BATS Options and Europe-based BATS Europe. In January, the BZX and BYX traded a combined $534 billion, representing more than 10 percent of the total U.S. equities market, according to company data.

Its European unit also had record-setting monthly performance, nearly doubling the monthly value of all the securities traded there, and climbing to nearly 7 percent market share in Europe overall.

Chi-X Europe is Europe’s second-largest equities exchange by value traded, with more than 1,300 securities across some 25 indexes and 15 European markets. It is also a platform where ETFs, exchange-traded commodities and international depositary receipts are traded. In 2010, more than 1.58 trillion euros’ worth of securities were traded there, according to data on the company’s website.

The exchange, launched in 2007, was designed to allow investors to trade equities across most European markets at much lower costs than many of the markets of listing, the company said.

 

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