DOW JONES NEWSWIRES
NYSE Euronext (NYX) announced it has agreed to acquire Nyfix
Inc. (NYFX) for $144 million, bolstering its efforts to improve its
trading operations.
The price tag, which includes preferred stock, comes as
operations such as the New York Stock Exchange and Nasdaq OMX Group
Inc. (NDAQ) try to stem market-share losses to upstarts such as
BATS and Direct Edge.
Nyfix shares will be purchased for $1.675 each, a 95% premium to
Wednesday's closing price. The stock traded above $45 in 2000 and
was down 74% the past year through Wednesday.
The deal is set to close in the fourth quarter and give NYSE
Euronext software intended to improve trading efficiency. The
company on July 1 announced order-execution times had been slashed
20-fold at the NYSE with the implementation of the new NYSE Super
Display Book system for processing orders. Ever-faster order
execution is a key factor for many traders, especially as automated
trading grabs an increasing amount of overall trading volume.
The trading system revamp took three months to roll out and
completes a process begun 18 months ago. Since then, NYSE has
completely replaced its order entry, database and routing systems
as well as market-data systems and parts of its post-trade
system.
More than 1,000 counterparties connect in Nyfix's marketplace.
NYSE Chief Financial Officer Michael Geltzeiler said the
acquisition will boost NYSE's technology business "and expands our
points of connectivity with customer trading communities." He added
cost savings and tax benefits will result from the deal.
NYSE shares closed Wednesday at $28.79 and were inactive
premarket.
-By Kevin Kingsbury, Dow Jones Newswires; 212-416-2354;
kevin.kingsbury@dowjones.com