Industry Trends – July 2022: Stock Exchanges/Trading Venues | White & Case LLP – JD Supra – JD Supra | Omd Cialis

UK & European Financial Services M&A: Industry Trends H2 2021 | H1 2022 — Stock exchanges/trading venues

Europe’s FMI goes digital – data analytics, capital markets solutions, RegTech and DLT-based tech acquisitions feed the steady stream of M&A activity.


The Running Market

  • Slight decline in M&A activity, excluding Europe’s leading trading venues

we see

  • Financial market infrastructure goes digital:
    • Data drive through acquisitions and investments (e.g. acquisition of Kneip by Deutsche Börse and LSE’s investment in Finbourne)
    • Capital market capitalization (e.g. LSE minority stake in Floww and Deutsche Börse minority stake in WeMatch)
    • Provision of RegTech solutions (e.g. acquisition of the Global Data Consortium by LSE)
    • Increasing convenience with DLT-based technology (e.g. Euroclear’s involvement in Fnality)
  • Payout of “liquid” bets by:
    • Banks (e.g. sale of 2.91% of SBP Exchange by Sovcombank)
    • Exchanges (e.g. sale of 9.85% in Euroclear by Intercontinental Exchange)

Key Drivers/Challenges

  • Exchanges expect increasing demand for:
    • Sustainability data (e.g. Euroclear equity investment in Greenomy)
    • Emission certificates (e.g. participation of Deutsche Börse in AirCarbon Exchange)
  • Search exchanges:
    • Scaling through horizontal growth (e.g. acquisition of 10.24% in BELEX by ATHEX)
    • Reach through diversification (e.g. acquisition of Ultumus by SIX)
    • Scope through vertical integration (e.g. acquisition of quantiles by LSE)
    • Leveraging new technologies to improve service delivery (e.g. Clearstream’s Asset Management Data Analytics JV with FNZ)
  • “Digital Era” FMI flexes M&A muscle in pursuit of the holy grail of digital assets:
    • Fully integrated digital asset exchange (e.g. Valereum acquires 90% of GSX)
    • Combine banking with DLT to offer faster and cheaper trading services (e.g. BitMEX’s acquisition of Bankhaus von der Heydt).
    • Establishing a transatlantic reach (e.g. the acquisition of FairX by Coinbase)
  • Private equity views FMI as a technology-enabled company (e.g. Silver Lake acquired 9.85% of Euroclear)

trends to watch

  • Exchanges are competing for ESG data/analytics providers as the demands of European banks and wealth managers increase exponentially

Our M&A forecast

Europe’s leading trading hubs will continue the inorganic growth rally, supported by colossal M&A war chests. However, as trade execution margins shrink, vertical integration becomes increasingly important to ensure profitability.

Data-driven growth

  • London Stock Exchange (data analysis): Acquisition of MayStreet (May 2022)
  • SIX (trade register): Acquisition of 50% in REGIS-TR (April 2022)
  • Deutsche Börse (data analysis): Acquisition of Kneip (March 2022)
  • London Stock Exchange (investment data): (Undisclosed) Interest in Finbourne (October 2021)
  • SIX (index and ETF data): Acquisition of Ultumus (July 2021)

horizontal expansion

  • Warsaw Stock Exchange (Stock Exchange): Acquisition of 65.03% stake in Armenia Securities Exchange (May 2022)
  • London Stock Exchange (market place for private capital): Minority stake in Floww (March 2022)
  • Deutsche Börse (wholesale derivatives platform): Acquisition of a minority stake in WeMatch (October 2021)
  • Athens Stock Exchange (Stock Exchange): Acquisition of 10.24% of Belgrade Stock Exchange (August 2021)

tech investments

  • London Stock Exchange (ID verification): Acquisition of the Global Data Consortium (April 2022)
  • Euroclear (DLT-based payment-on-chain): Equity investment in Fnality (March 2022)
  • London Stock Exchange (Trading Technology): Takeover of Tora (February 2022)
  • London Stock Exchange (efficiency optimization): Acquisition of Quantile Group (December 2021)

Vertical partnerships

  • clear current: Data Analysis JV with FNZ (April 2022)

ESG investments

  • Deutsche Börse (Carbon Credit Trading): Equity Investment in AirCarbon Exchange (March 2022)
  • Euroclear (ESG compliance): Participation in Greenomy (February 2022)

PE firepower

  • silver lake: Acquisition of 9.85% in Euroclear (October 2021)

Payout of “liquid” stakes

  • Sovcombank: Sale of 2.91% of SPB Exchange (October 2021)
  • Intercontinental Exchange: Sale of 9.85% to Euroclear (October 2021)

Fintechs flex their muscles

  • BitMEX: Acquisition of Bankhaus von der Heydt (January 2022)
  • Coin base: Acquisition of FairX (January 2022)
  • Valereum Blockchain: Acquisition of 90% of the Gibraltar Stock Exchange (January 2022)
  • FTX: Participation in $150M Series C Extension Funding Round for Chipper Cash (November 2021)


  • SPB Exchange: $175 million SPB Exchange IPO (November 2021)

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