Market participants to benefit from tighter spreads and deeper liquidity
NYSE Euronext has agreed on a framework with liquidity providers and market making firms – BofA Merrill Lynch, Barclays Capital, Citadel Securities, Citi, Goldman Sachs, TD AMERITRADE and UBS – to sell a significant equity interest in NYSE Amex options, one of the company’s two US options exchanges.
Reportedly, it will remain the largest shareholder in the entity, which aims to enhance the competitive position of NYSE Amex options, while bringing competitive and operational benefits to the marketplace. The contemplated transaction is expected to enable NYSE Amex options to offer customers deep liquidity on an exceptional technology platform. NYSE Amex options also anticipates making other services available, including the facilitation of open-outcry orders.
Duncan Niederauer, CEO of NYSE Euronext, said: “This partnership will further align our business interests with those of our customers, and makes NYSE Amex options an even more compelling trading venue within an increasingly competitive marketplace. We welcome this shared commitment to deliver the highest levels of innovation and market quality to our options trading platform.”
Edward Boyle, senior VP, US Options for NYSE Euronext, said: “Market participants will benefit from tighter spreads, deeper liquidity, superior technology, and the distinct market model of NYSE Amex options. We plan to continue to enhance technology and quoting speed, building upon existing service offerings, and introducing new products and order types to generate future order flow.”
The contemplated transaction would call for NYSE Euronext to continue to manage the day-to-day operations of NYSE Amex options, which would operate under the supervision of a separate board of directors and chief executive officer. The contemplated transaction is subject to the negotiation and execution of final legal documentation and obtaining the requisite regulatory approvals. NYSE Euronext anticipates that the transaction could be completed by the end of 2009.