(Adds details, context)
Oct 17 Financial and commodity markets operator
Intercontinental Exchange Inc will have to sell
commodities software house Trayport to preserve competition in
the energy trading industry, Britain's competition watchdog said
on Monday. bit.ly/2elcJZN
ICE, one of the world's biggest exchange operators, closed
its deal to buy Trayport in December last year for around $650
million in stock. It beat off arch-rival CME Group Inc
to acquire the technology firm and reinforce its position in
European energy trading markets.
But Britain's Competition and Markets Authority said on
Monday that traders, brokers, exchanges and clearing houses that
compete with ICE in the trading and clearing of European
utilities, depend on the Trayport platform to carry out these
The watchdog concluded that the deal needed to be unwound as
ICE could use Trayport's platform to reduce competition between
itself and its rivals, leading to increased fees for execution
and clearing, and a worsening of terms offered to traders.
"ICE is disappointed by the decision, having presented a
compelling clearance case, and will now consider its options
including the possibility of an appeal," the company told
Reuters in an emailed statement.
ICE competes with brokers including ICAP, BGC
Partners, GFI Group, Tradition, Tullett Prebon
A forced sale of Trayport could free up cash for ICE to make
a bid for Britain's London Stock Exchange Group.
The New York Stock Exchange owner shelved plans in May to
make a counterbid for the London exchange, which is already
trying to merge with Germany's Deutsche Boerse.
ICE said then that it still had the right to reconsider and
make an offer for LSE Group within the next six months, provided
it had approval from the British Panel on Takeovers and Mergers.
A takeover of LSE Group by ICE could create the world's
biggest exchange group, spanning the Atlantic and trading and
clearing stocks, derivatives, energy and commodities.
(Reporting by Noor Zainab Hussain in Bengaluru and Huw Jones in
London; Editing by Adrian Croft)