Welcome mat at Tradepoint
|
|
September 15, 1999: 9:40 a.m. ET
Fledgling U.K. exchange, reacting to report, says it's ready for new members
|
CITY (CNNfn) - Tradepoint Financial Networks, a fledgling U.K.-based stock exchange, said Wednesday it would "welcome" the addition of new members to the consortium that owns a 54 percent in the company.
The statement was prompted by a report in Wednesday's Wall Street Journal that three leading securities firms are poised to enter the consortium later this week in an effort to beef up Tradepoint's presence in the U.K. markets. The exchange accounts for less than 1 percent of total London stock exchange volume.
Tradepoint's current consortium, assembled as part of a refinancing package for the exchange announced in early May, is comprised of Instinet Corp., a Reuters (RTR) unit, Morgan Stanley Dean Witter & Co. (MWD), J.P. Morgan & Co. (JPM), and UBS's investment-banking subsidiary, Warburg Dillon Read.
The Journal, citing people familiar with the matter, reported that three more members -- Merrill Lynch & Co. (MER), Dresdner Bank (FDRB) and Credit Suisse First Boston -- are looking to join the consortium in order to lend it extra clout.
The addition of new members, if and when it happened, would not result in a change in the consortium's overall majority stake, a Tradepoint spokesman told CNNfn.com.
The development follows reports earlier this week that a group of top U.S. banks are joining forces with a Swiss partner to launch a pan-European equity platform. The move is seen as way for the banks to cut costs and transaction times for trades in Europe's fragmented markets.
Despite the advent of a common currency and closer cross-border political cooperation, Europe has been slow to integrate its financial markets -- despite concerted efforts at "harmonization" among the eight major national bourses.
The perceived foot-dragging, analysts say, has caused consternation among brokers whose appetite for pan-European trades has grown more rapidly than individual markets' ability to provide them cheaply and quickly.
Tradepoint, established in 1996, currently has more than 80 members. Though it has ambitions to branch out into pan-European trade, the addition of new members would be aimed at helping to redress the exchange's still-feeble presence in the U.K. market, the Journal said.
Merrill Lynch, the newspaper said, is already an indirect investor in Tradepoint via U.S.-based Archipelago Holdings.
In a brief statement Wednesday, Tradepoint stressed that decisions pertaining to consortium membership are made by the consortium members.
"Whilst the company is not party to any discussions, the board is aware that the consortium is in discussions with a small number of investors," the statement said.
In a circular to shareholders dated May 20, the company added, it noted that "the benefits to Tradepoint may be enhanced by additional substantial financial institutions joining the consortium. Accordingly, the board would welcome the involvement of additional consortium members."
Tradepoint shares rallied Wednesday in London, soaring 7.08 percent to 151 pence by mid-afternoon.
|
|
|
|
|
|