Bloomberg News

Bats Proceeds With Chi-X Buy as U.K. Regulator Clears Purchase

November 24, 2011

Nov. 24 (Bloomberg) -- Bats Global Markets Inc. will proceed with its acquisition of Chi-X Europe Ltd., Europe’s biggest alternative trading system, after the U.K.’s antitrust regulator cleared the deal.

The combined company, to be called Bats Chi-X Europe, will account for about 25 percent of European equities trading, according to a statement.

The commission “found that customers would have the power to prevent any attempt by the merged company to raise trading fees or worsen service quality, by taking, or threatening to take, their business elsewhere or even potentially sponsoring new entry,” it said in a statement today.

Bats, the operator of the second-largest alternative trading system in Europe, has held talks to buy Chi-X Europe, founded in March 2007 and owned by banks and brokers. The U.K.’s Office of Fair Trading referred the deal to the Competition Commission in June. The regulator granted provisional approval on Oct. 20.

The European Commission is examining a separate deal between Frankfurt-based Deutsche Boerse AG and the owner of the New York Stock Exchange that would create the world’s biggest stock-market operator.

Chi-X Europe was the first alternative trading platform in Europe to compete with traditional exchanges such as London Stock Exchange Group Plc and Deutsche Boerse by offering lower fees and faster trading.

The trading platform is partly owned by Instinet LLC, a New York-based unit of Nomura Holdings Inc., and by investment banks and traders including Credit Suisse Group AG, Getco LLC, Bank of America Corp., Citigroup Inc. and Morgan Stanley. Bats is owned by Bank of America, Citigroup, Getco, Credit Suisse and Morgan Stanley, among others.

--Editor: Will Hadfield

To contact the reporter on this story: Nandini Sukumar in London at nsukumar@bloomberg.net

To contact the editor responsible for this story: Andrew Rummer at arummer@bloomberg.net


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