CME Group Inc have today announced that they have purchased Michael Spencer’s NEX Group plc for a total of £3.9 billion.
The transaction has been approved unanimously by the board of directors of both companies and is expected to close, pending approvals by regulators and NEX shareholders, in the second half of 2018.
This acquisition brings together two trading-industry trailblazers to create a leading, client-centric, global markets company that will deliver better ways to trade and manage risk across futures, cash and OTC products.
Combining NEX’s leading electronic FX and fixed income cash execution platforms with CME Group will improve trading technology and streamline access by reducing the number of touchpoints that clients need to trade across products.
CME Group Chairman and Chief Executive Officer Terry Duffy said: “At a time when market participants are seeking ways to lower trading costs and manage risk more effectively, this acquisition will allow us to create significant value and efficiencies for our clients globally.
“As one organisation, we will be able to employ the complementary strengths of each company to serve a wider client base while diversifying our combined businesses across futures, cash and OTC products and post-trade services.
“Michael Spencer and his senior leadership team have built a world-class organisation that is at the centre of capital markets. We are committed to maintaining the longstanding relationships NEX has with its clients, and exchange and clearing house partners.”
Following completion of the acquisition, NEX CEO Michael Spencer will join the CME Group Board of Directors.
Spencer said: “The combination of NEX and CME will be an industry-changing transaction. Bringing together cash and futures products and OTC services will be unique, offering clients improved access to trading, greater financial efficiencies and highly valuable data sets. The technology and innovation opportunities will be diverse and extraordinary. Clients will be better served.”
J.P. Morgan is acting as lead financial advisor and Barclays is acting as financial advisor to CME Group, and Skadden, Arps, Slate, Meagher & Flom LLP is acting as CME Group’s legal advisor. Evercore and Citi are acting as financial advisors to NEX, and Clifford Chance LLP is acting as NEX’s legal advisor.