Had NYSE Euronext merged with Deutsche Börse, NYSE Technologies could have claimed perhaps the most formidable portfolio of trading tools and services of any of its competitors.
Above all, the difference maker would have been Xetra, the trading system for Deutche Borse, which it claims to be the world's most efficient and flexible system infrastructure for fully electronic securities trading. Fourteen stock exchanges around the world have licensed use of Xetra, developed by Accenture and Deutsche Boerse Systems.
Then, European antitrust officials blocked the Euronext’s planned merger with the German exchange, which meant that the NYSE was on its own.
Or might want to seek a new partner. The ideal candidate would supply technology and connections for trading around the world and, hopefully, sustain or better NYSE Technologies 25 percent growth rate.
Enter Fixnetix, the rapidly growing UK trading technology company. For under $30 million NYSE Euronext has offered to buy 25 percent with an option to acquire the remaining 75 percent over the next three years. The acquisition shores up Euronext’s all important technology capabilities in a number of ways, says Don Henderson, CTO, NYSE Technologies.
“It provides us access to the 10 percent of exchanges in Europe and the U.S. that we presently don’t have as well as significantly more co-location hubs and data centers,” he said.
Fixnetix is in 33 co-location and proximity hosting centers across Europe and the US and offers trading access to more than 50 markets. .
Henderson also points out that Fixnetix has a number of important technology tools including a real-time low latency filter, iX-eCute, which uses chips laden with field-programmable gate arrays to solve the eternal industry conundrum of how to check trades for potential effects on the market before orders are sent in, how to make sure the orders comply with financial regulations and then still accomplish “ultra-low latency” execution. Before someone else’s order arrives.
Most important, however, Fixnetix as a managed service outsourcer, is accustomed to working with a variety if IT infrastructures that don’t align with Euronext’s infrastructure. As a result, “they provide the capability of managing complex client deals,” says Henderson.
That kind of capability is going to be critical if NYSE Technologies is going to reach its goal of generating more than $1 billion in annual revenue.