MX pushing forward
The Montreal Exchange Inc. (MX) is strengthening its position in North America’s standardized derivatives business by purchasing a majority stake in the Boston Options Exchange (BOX) for more than $50 million.
The financial derivatives exchange plans to increase its holding from 31.4% to a maximum of 53.2%. It had previously agreed to buy 13.3% of BOX in a deal signed in August 2006 with the Boston Stock Exchange (BSE) but agreed to acquire the additional 8.6% after Nasdaq’s recently announced acquisition of BSE. Nasdaq agreed to acquire BSE for $61 million but was not interested in any of its 21.9% stake in BOX.
Nasdaq will pay $38 million cash and assume $23 million in debt to buy the 173-year-old BSE, which lost nearly $3 million in 2006.
Interactive brokers, an original partner in BOX, had no comment on the deal.
MX also recently filed for approval of rules governing trading of futures contracts on Canadian carbon dioxide emission credits. This follows its announcement in July of a plan to launch the Montreal Climate Exchange in a joint venture with the Chicago Climate Exchange. The proposed rules, filed with Quebec’s Autorite des Marches Financiers, are open to a 30-day public comment period and MX plans to begin trading by year end.
Broker consolidation
Futures and options broker MF Global Ltd. (MF), has acquired 100% of the share capital of BrokerOne Pty Ltd., a Sydney-based broker that has captured the leading market share of futures contracts traded on the Sydney Futures Exchange (SFE). MF Global believes the transaction will be accretive over the next 12 months.
Kevin Davis, chief executive officer of MF Global, said in a statement, “Our purchase of BrokerOne further advances our Asia Pacific growth strategy.”
Approximately 10% of MF Global’s net revenues in fiscal 2007 came from the Asian Pacific region.
Germans to list Bombay Indices, deepen Irish ties
Deutsch Börse is continuing to strengthen its global presence with cross-border agreements, most recently by deepening relationships in India and Ireland. In early October, it agreed to extend its existing technology partnership in equities trading and clearing with the Irish Stock Exchange by two years, until 2012. A week later, it cut a deal to act as exclusive worldwide sales partner for all indices of Bombay Stock Exchange (BSE), in which it has a 5% stake.
Deal is off
The merger between Iowa Grain Company and R.J. O’Brien, which was expected to close this summer, has apparently broken down. An Iowa Grains representative said that company policy is to not comment on such matters, but added, “Iowa Grains is still an independent company.” R.J. O’Brien chief executive officer Gerald F. Corcoran had not returned calls as of press time.
