Global exchange group NYSE Euronext is considering the sale of NYFIX’s Millennium and Euro Millennium dark pools, having acquired the US-based connectivity-to-transactions technology provider to exploit buy- and sell-side synergies with its NYSE Technologies electronic trading solutions subsidiary.
“Millennium is a broker-dealer business and we are looking at the strategic opportunities for the future of that business,” said Stanley Young, CEO, NYSE Technologies and co-global CIO of NYSE Euronext. Divestment of US-based Millennium and Euro Millennium, registered as a multilateral trading facility (MTF) in Europe, is understood to be an option, with a number of potential acquirers already having shown interest.
NYSE Euronext agreed to buy NYFIX in an all-cash deal for $1.675 per share of common stock that values the company at $144 million, including preferred stock consideration.
Last week, Turquoise, a displayed liquidity MTF owned by a consortium of global banks, was reported to have appointed UBS, one of founder members, to identify potential buyers.
NYSE Euronext’s purchase of NYFIX means NYSE Technologies will take on NYFIX’s FIX software business and NYFIX Marketplace, a global community of over 1,000 buy- and sell-side trading counterparties that access NYFIX’s connectivity and other trading services.
Young said NYFIX’s businesses were “highly complementary” to NYSE Technologies’ existing portfolio. “At the connectivity level, for example, NYFIX has 450 buy-side clients that don’t currently have access to our Secure Financial Transaction Infrastructure (SFTI), so the acquisition represents a tremendous opportunity to add to an already substantial community,” he said.
NYSE Technologies’ SFTI network is designed to carry high volumes of electronic trading and market data traffic, and provides users with a single point of connectivity for low-latency access to multiple markets.
Young predicted that NYFIX’s buy-side clients would be able to leverage NYSE Technologies’ range of connectivity, data, hosted and managed services. “Buy-side firms that are looking to get closer to the market through low-latency trading will be able to host their technology within our new data centres, access sell-side firms across our ultra low latency network infrastructure and feed their front-office applications with our aggregated data feed, SuperFeed. We hope the buy-side will be excited by the opportunities this acquisition creates, not least in terms of our future ability to offer managed services capabilities.”
Young added that NYSE Technologies remained open to further acquisitions that complement its current suite of products and services.
Launched by NYFIX in Q1 2008, Euro Millennium was the first independent dark pool to go live in Europe following the introduction of MiFID in November 2007. Millennium has been operating in the US equities market since 2000.