The Nasdaq Stock Market has taken a majority shareholding in Easdaq, the pan-European stock exchange, and will use it to construct a new pan-European market called Nasdaq-Europe.
The acquisition costs along with the construction of a new trading platform for the region and related investments will cost about E70m, according to Reuters. The plan is subject to approval from Easdaq shareholders, expected later this month.
Nasdaq will initially acquire approximately 58 per cent of the company but after the exercise of warrants outstanding and the issuance of additional shares, it will own about 51 per cent. The European trading platform will be under the supervision of the Belgian Market Authority, the Belgian Banking and Finance Commission, and the Belgian minister of finance.
Talks between Nasdaq and other European exchanges such as Deutsche Boerse and the London Stock Exchange are ongoing. Nasdaq chairman, Frank G Zarb, said: “Today's announcement demonstrates our commitment to become a major part of the European marketplace. This agreement is one important step towards this objective, while we continue to assess a wide range of possibilities with other European partners.” Zarb went on to say that the acquisition of Easdaq”moves us closer to achieving our strategic vision of an international Nasdaq – Nasdaq Europe, Nasdaq US and Nasdaq Japan.”
Chairman of Easdaq, Stanislas Yassukovich, said: “Easdaq was originally modelled on Nasdaq – with a broad base shareholders and the highest standards of regulation – the market was designed to be compatible with Nasdaq. This transaction represents the culmination of many years of effort to create a pan-European stock market for growth companies which will be part of a global trading platform. The founding members will strongly recommend that shareholders approve this transaction.
The Nasdaq market will offer links to European, Asian and US stocks, exchange traded funds, and warrants. Retail and institutional investors will be able to trade efficiently and cost effectively during trading hours.
By May or June, Nasdaq Europe will launch a European trading system (ETS), which will offer Nasdaq’s current services whilst covering the European market. Features will include executable Market Maker quotes, matched trade reporting and an electronic broker-to-broker negotiation facility.
Knight Trading Group, the New Jersey-based brokerage firm that has a 19 per cent stake in Easdaq, will remain as a strategic investor and eight major securities firms have indicated their intent to join Nasdaq. Other strategic investors are expected to follow.