16th September 2009, www.bloomberg.com
London Stock Exchange Group Plc, Europe’s largest bourse by value of listed companies, agreed to buy Sri Lankan technology services company MillenniumIT for $30 million in cash and stock to gain access to its trading systems.
The London-based exchange expects to complete the acquisition by October and to start moving customers to the new trading system from its TradElect platform by the end of next year, LSE said in a Regulatory News Service statement today.
Sanford C. Bernstein & Co. estimates the LSE could save “almost 70 million pounds ($115 million) in costs, largely as a result of staff cuts, replacing the TradElect system and migrating MTS trading onto the new platform,” Dirk Hoffmann-Becking, a London-based analyst, wrote in a Sept. 14 report.
Traditional exchanges including LSE, Frankfurt-based Deutsche Boerse AG, and NYSE Euronext are moving to new trading systems to cut trading times and costs as a host of new rivals, so-called multilateral trading facilities including Turquoise and Chi-X Europe Ltd., take market share.
“This transaction enables the group to implement a new, more agile, innovative and efficient IT capability for our future business development as well as running a new cash trading platform which will provide substantially lower latency, significantly higher capacity and improved scalability,” LSE Chief Executive Officer Xavier Rolet said in the statement. “It will also offer cost saving opportunities in the future and give the group a footprint in Asia.”
To contact the reporter on this story: Andrew Rummer in London at firstname.lastname@example.org.