ICE CEO Details Decade-Long Pursuit For Liffe
04 Maggio 2011 - 8:30PM
Dow Jones News
IntercontinentalExchange Inc. (ICE) founder Jeff Sprecher on
Wednesday detailed a decade-long pursuit of the European futures
platform now owned by NYSE Euronext (NYX) as he presses the latest
bid to lift his company into the elite tier of global
exchanges.
Sprecher, ICE's chairman and chief executive, said the company
had held talks with management at the London-based Liffe unit in an
effort to diversify his commodity-focused business with some of the
world's most heavily-traded financial futures and options.
"ICE has a long history of interest in owning the Liffe
business," he said on a post-earnings call. "I was never able to
convince any of the various CEOs that oversaw the parent companies
over the last 10 years that that was a good idea."
This included the current management of NYSE Euronext, which he
said had engaged with ICE on the topic until mid-2010.
"In fairness to NYSE, it would have meant they would have given
up the management control of their derivatives business," he
said.
The Big Board operator declined comment. NYSE Euronext wants to
stay wedded to the high-margin derivatives business, and its board
has twice spurned the joint effort to carve up the company led by
Sprecher and Nasdaq OMX Group Inc. (NDAQ)
Sprecher is widely regarded within the industry as one of its
most visionary and creative executives, and a string of
acquisitions has expanded ICE from its roots as a power-trading
exchange.
The disclosure of his long-held interest in Liffe--itself long
coveted by NYSE Euronext merger partner Deutsche Boerse AG (DB1.XE)
and others--highlights Sprecher's desire for a more
transformational deal.
The door appeared to have closed after his unsuccessful pursuit
in 2007 of the Chicago Board of Trade--which opted to merge with
the Chicago Mercantile Exchange to create CME Group Inc. (CME)
after an often-bitter five-month contest. But Liffe, formerly the
London International Financial Futures Exchange, has been a
long-time target, Sprecher said.
Since ICE acquired the London-based International Petroleum
Exchange, or IPE, in 2001, Sprecher said he has been pitching
Liffe's various owners on the idea of ICE taking control, with
ownership split in a joint venture structure.
At the start of the decade ICE was an upstart energy market that
drew upon its momentum in U.S. power trading to acquire the IPE,
giving the company an international platform for crude oil and
natural gas trade.
Euronext, the Paris-based exchange operator, agreed at the end
of 2001 to acquire Liffe, subsequently merging with NYSE Group in
2007 to form NYSE Euronext. The derivatives arm was renamed NYSE
Liffe.
Adding NYSE Liffe's franchise of interest-rate and stock-index
futures to ICE's existing platforms for trading energy, commodities
and currency contracts would diversify its offering and make it the
world's fourth-largest futures exchange company by volume,
according to figures compiled by the Futures Industry
Association.
-By Jacob Bunge, Dow Jones Newswires; 312-750-4117;
jacob.bunge@dowjones.com
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