Futures trading giant CME Group has reached a deal to buy U.K.-based trading firm NEX Group for £3.9 million ($5.49 billion).
CME will acquire London-based NEX in a transaction valued at £10 ($14) per share, consisting of £5 in cash along with also 0.0444 CME Group shares, based on CME’s closing share cost of $158.84 on Wednesday, the companies said in statements Thursday.
The transaction is actually supposed to close inside the second half of 2018, pending on the approval of regulators along with also NEX shareholders.
NEX is actually a provider of currency along with also fixed income platforms, along with also various other over-the-counter (OTC) post-trade products along with also services.
The two companies said earlier This particular month in which CME had approached NEX having a takeover offer, a move in which triggered speculation in which there could be rival takeover bids via various other players like International Exchange Group or the London Stock Exchange.
As part of the acquisition, NEX shareholders will be entitled to receive £5 in cash for each NEX share along with also 0.0444 shares of CME Group.
“At a time when market participants are seeking ways to lower trading costs along with also manage risk more effectively, This particular acquisition will allow us to create significant value along with also efficiencies for our clients globally,” CME Group Chairman along with also Chief Executive Officer Terry Duffy said Thursday.
“As one organization, we will be able to employ the complementary strengths of each company to serve a wider client base while diversifying our combined businesses across futures, cash along with also OTC products along with also post-trade services.”
NEX CEO Michael Spencer will join CME’s board of directors as part of the deal.
The transaction is actually supposed to generate cost synergies of $0 million annually by the end of 2021, assuming the deal is actually completed This particular year.
The deal puts the U.S. derivatives giant in a prime position to shake up the U.S. Treasurys market. NEX provides one of the planet’s largest platforms for U.S. Treasurys trading, BrokerTec.