EXCHANGE NEWSWIRE, 25 April 2011
NYX rejected the NDAQ-ICE bid for a second time in favor of DB1’s bid. The NYX board concluded that the revised NDAQ-ICE proposal “is substantially the same as what was previously rejected” and believes there are “closer to EUR400m” in cost savings in the deal with DB1, and NYX CEO Duncan Niederauer estimated that the largest customers would save at least $3b through the combination of NYX and DB1.
NDAQ-ICE issued a statement stating that NYX shareholders should be skeptical of the additional EUR100m in costs synergies that is expected from DB1-NYX deal. The statement also said that “the increase appears not to be a matter of sharpening a pencil, but an unexplained shift in strategy”. It also stated that the extra synergies “has to come at the expense of NYX stockholders because there has been no increase in the price they are being offered”.
NDAQ-ICE bid for NYX may face greater inquiry by US Senator Charles Schumer, who asked for data on estimated job losses in the proposal for NYX “prior to taking additional steps in your acquisition efforts”.
NYX: NYSE Liffe will launch new interest rate derivatives in the fall, and aims to expand its market share of Eurodollar futures to 10% over the next year after capturing 3% since entering the market in March. NYSE Liffe CEO Tom Callahan said the “core mission is first to establish ourselves as a viable competitor to CME”, and that in 3Q 2011 NYSE Liffe will introduce an electronic market for trading options on Eurodollar futures.
LSE: Turquoise commercial director Natan Tiefenbrun said that LSE is at a competitive disadvantage to shift derivatives trading volumes from incumbents because LSE does not own its own clearing house, and that the incumbents “can use that in an anti-competitive fashion to exclude new entrants and competitors”. Tiefenbrun voiced expectations that the competition review of the DB1-NYX merger “could see remedies that result in open access to clearing and fungibility of derivatives contracts”.
CME will offer Sovereign Yield Spread futures to allow investors access to and manage exposures to various country combinations. The contracts will initially include bond from France, Germany, Italy, the Netherlands, the UK and the US, after which the range will be expanded.
JNS CFO Greg Frost will leave the firm on August 1 and will be replaced by Bruce Koepfgen, who will join the firm in June. Koepfgen previously worked as CEO of Oppenheimer Capital, an Allianz Global subsidiary, and was chairman of Allianz Global Investors Fund Management. Prior to that, Koepfgen was with Salomon Brothers for 23 years.
South Korean government may consider reducing FX derivatives limits after the central bank, Bank of Korea, stated that the surge in short-term offshore borrowings in 1Q 2011 could indicate that banks had more than enough positions for FX derivatives trading. An inspection will be carried out from April 26 to May 6 on derivatives positions which could be expanded into those with heavy non-deliverable forward positions.
SEC appointed Julius Leiman-Carbia as head of SEC’s National Broker-Dealer Examination Program. Outside of serving at the SEC from 1989, Leiman-Carbia was also Managing Director of the Capital Markets and Banking Compliance Department at Citigroup from 2005 to 2009, and held legal and compliance leadership positions at JP Morgan and Goldman Sachs.
European Markets and Infrastructure Regulation (EMIR) will produce a paper after reviewing the European Commission’s proposed OTC regulation. The key discussion points include the degree to which interoperability should be allowed between CCPs without further review, whether or not OTC derivatives clearing should be introduced retroactively, and what exemptions there might be for clearing.
Provided By: Equity Research Desk, www.erdesk.com
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