NYX Nyse Euronext

The bosses of IntercontinentalExchange Inc. (ICE) and Nasdaq OMX Group Inc. (NDAQ) said Friday they are counting on the increasingly global nature of the exchange business to secure U.S. regulatory approval for their $11.3 billion offer for NYSE Euronext (NYX).

Nasdaq Chief Executive Bob Greifeld and ICE Chairman and CEO Jeff Sprecher argued that the business of listing shares has gone worldwide, with the intensely competitive U.S. exchanges increasingly ceding business to Hong Kong, London and other jurisdictions.

Combining NYSE and Nasdaq's U.S. listings businesses represents perhaps the biggest antitrust stumbling block for the two companies' unsolicited bid for NYSE Euronext, which agreed last month to join with German operator Deutsche Boerse AG (DB1.XE) in a $25 billion combination.

ICE and Nasdaq now aim to split the Big Board parent in two, with the stock and options platforms going to Nasdaq and ICE getting the lucrative U.K. futures division Liffe.

"You have to look at this business globally," Greifeld said in a conference call discussing the companies' rival bid Friday. "Competition authorities will see through to the true nature of competition."

Greifeld said he was "reasonably confident" of his plan to consolidate U.S. stock listings under a single roof, and noted that the Securities and Exchange Commission would put the matter up for public review.

Patrick Healy, CEO of Issuer Advisory Group, said the proposed deal creates "mega anti-trust issues."

"In the coming days you will likely see this positioned as the choice between the lesser of two bitter pills: foreign ownership versus a listings monopoly," said Healy, whose company specializes in listings matters, in an email.

Merging the U.S. stock- and options-trading businesses under Nasdaq's ownership--Greifeld said he plans to keep NYSE's two domestic stock and two options platforms open--would raise fewer regulatory concerns due to the competitive structure of the markets and actually help reduce fragmentation, according to the Nasdaq CEO.

"As we bring different venues into one data center, we will implement a series of common controls across venues, and would be able to run this as if it is one virtual limit order book," he said. "You will see a higher degree of integration between venues while maintaining their distinct personalities."

Sprecher said bringing more stock-trading platforms under one roof would help boost damaged investor confidence. "NYSE under Nasdaq creates a more consistent market for regulators to oversee," he said.

The proposed Nasdaq-ICE deal for NYSE Euronext geographically flips the competitive issues seen in the Big Board owner's agreed deal with Deutsche Boerse. There, analysts have seen the combination of the two companies' European derivatives platforms--Liffe and Eurex--as the biggest issue, raising the potential of a monopoly on European interest-rate and stock-index futures trading and clearing.

"This preserves important competition in the derivatives trading and clearing business," Sprecher said. ICE leadership of the Liffe franchise would also help broaden distribution of its products, and help revive a platform Sprecher said has underperformed rivals like CME and Eurex in recent years.

-By Jacob Bunge, Dow Jones Newswires; 312-750-4117; jacob.bunge@dowjones.com

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