Nandini Sukumar
CME Group, the world’s largest futures exchange, has approached Deutsche Boerse to consider beginning talks on a merger, according to four people familiar with the situation.
CME had contacted the Frankfurt-based exchange at the end of last year, before IntercontinentalExchange announced plans to buy NYSE Euronext in December, said the people, who asked not to be identified as the talks are private.
Deutsche Boerse, which had its takeover of NYSE Euronext blocked by European regulators a year ago, was hesitant about entering talks, the people said.
A combination of Chicago-based CME and Deutsche Boerse would unite the biggest futures exchanges in the US and European markets. CME shares have rallied 15 percent this year, giving it a market capitalisation of $19.4 billion (R172bn). Deutsche Boerse rose 1 percent through last Friday, bringing its value to e9bn (R106bn).
The companies met again last month to debate whether to begin formal takeover talks and had not yet made a decision, the people said. No offer had been made, nor had terms been discussed, they said.
Frank Herkenhoff, a spokesman for Deutsche Boerse in Frankfurt, and Allan Schoenberg, a spokesman for CME in London, declined to comment.
CME, like IntercontinentalExchange, has expanded in the past decade through deals, buying the Chicago Board of Trade and New York Mercantile Exchange. It unsuccessfully tried to purchase the London Metal Exchange last year.
Interest rate futures are CME’s biggest business, while Deutsche Boerse’s Eurex derivatives trading venue hosts the benchmark euro-bund future.
Intercontinental Exchange’s $8.2bn agreement to buy NYSE Euronext has ignited a fresh round of talks for exchange companies – already the subject of $50bn in attempted deals in the past three years.
Japan Exchange Group, created by the merger of the nation’s two biggest bourses, might consider an alliance or merger with an overseas exchange, chief executive Atsushi Saito said at the beginning of this month.
The company would consider talking with CME, Deutsche Boerse, BM&FBovespa – the operator of Latin America’s biggest trading venue – or Korea Exchange, Saito said.
Hong Kong Exchanges & Clearing, the world’s largest bourse by market value, completed the $2.2bn takeover of the London Metal Exchange in December. Singapore Exchange, the operator of southeast Asia’s biggest stock market, has held talks to join London Stock Exchange Group by buying a stake in LCH.Clearnet, Europe’s largest clearinghouse, according to three people familiar with the negotiations.
Nasdaq OMX Group held preliminary talks with Carlyle Group about going private before talks broke down on price, a person with knowledge of the matter said. – Bloomberg