Intercontinental Exchange Inc has announced that it will purchase the broker-tech firm commissioner Trayport for $650 million in stock. The owner entity of the NYSE said on Monday that the deal will allow it to provide new services to the over-the-counter energy market in Europe. This includes European power, natural gas and coal.
Intercontinental Exchange Buys Trayport
Trayport is an arm of the GFI Group and was taken over by BGC Partners in March this year (2015). Now Intercontinental Exchange has agreed to buy the company. Trayport licenses its technology platform to help brokers execute electronic and hybrid trades. The platform mostly serves OTC utility markets in Europe.
Intercontinental Exchange has said that, as a part of the company, Trayport will extend a greater range of assurance and analytics services as the over the counter markets grow. Trayport is based in london and will keep providing its customers with its tech platform. Such customers include brokers, energy producers and consumers, exchanges and clearing houses. Intercontinental Exchange plans to extend its services to emerging energy markets in Asia as well.
“European regulators have made clear that they do not expect OTC gas and power markets to be subject to the mandatory clearing provisions that are being applied to other commodity markets,” said Jeffrey Sprecher, Chief Exec at International Exchange. “As such, these vital markets will require continued investment as part of the European energy market evolution.”
Trayport will benefit greatly from ICE’s worldwide tech infrastructure. ICE’s expertise in managing secure data should serve the acquired firm well, too.
“In addition, with ICE’s experience in managing secure technology, we are well positioned to support the continued development of these systems,” assures Sprecher. “Consistent with our track record of bringing improvement to markets, we will invest and enhance the trayport offering based on evolving consumer needs.”
The board of directors of both these firms are reported to have been completely on board with the buy-out. The deal is set to be finalized in the first quarter of 2016. This will also depend on the closing conditions being met and the approval of industry regulators.
“We are pleased to take the next step in rapidly changing European OTC utility landscape with ICE’s stability, and capacity to invest in our growth,” reports Elliot Piggot, CEO of Trayport. “Our customer-centric platform will continue to serve the needs of the utilities market as it evolves. We look forward to completing the transaction and advancing into our next stage of growth.”