Intercontinental Exchange (ICE) has started to break up NYSE Technologies and sell some of its business units following the acquisition of the technology business and its parent NSYE Euronext in November 2013.
The first sale was made last month, when ICE sold the 25% holding in London-based Fixnetix that NYSE Technologies acquired in February 2012 back to the company. This week, ICE signed a definitive agreement to sell Wombat Financial Software and SuperFeed to SR Labs, begging the question of what will happen to both large NYSE Technologies businesses, such as NYFIX, the SFTI network and its US and UK data centres, and smaller businesses such as Appia and Metabit.
While ICE declined to comment on the future of any of these businesses, the sale of Wombat to SR Labs suggests it is following strategy set down by chairman and CEO Jeffrey Sprecher days after the NYSE Euronext acquisition. In a strategy and financial update on 19 November 2013, Sprecher said ICE would maintain the SFTI network and commented: “We believe that we can improve the operational efficiency of SFTI, given our shared businesses and resources, so we are intending to maintain and improve this business.”
He also reprieved NYSE Technologies’ US and UK data centres in Mahwah, New Jersey, and Basildon, to the east of London, saying: “We intend to maintain the operation of NYSE’s two state-of-the-art data centres. We performed an economic analysis of moving to third-party data centres and found that it was better to retain our own.”
Describing the remaining businesses in NYSE Technologies’ portfolio as ‘some very interesting standalone technology businesses’, Sprecher said ‘the best way to grow these assets is to find a new home for them’. Included in this tranche of businesses are: NYFIX, which was acquired by NYSE Euronext in August 2009 and operates FIX Software and the NYFIX Marketplace; the Appia FIX messaging solutions; and Metabit, a Tokyo-based provider of market access products that was acquired by NYSE Euronext in September 2011.
Sprecher also put Wombat Financial Software and SuperFeed up for sale. Terms of the agreement under which SR Labs will acquire these businesses, which provide data management solutions and connectivity services, have not been disclosed, but it is expected that the transaction will close in the third quarter of 2014. SR Labs, a New York-based provider of low latency market data and exchange connectivity solutions, suggests the acquisition will complement its existing business and support the development of broader market data and exchange connectivity solutions.
Having found a buyer for Wombat and SuperFeed, ICE says it will make further announcements regarding the remaining NYSE Technologies business units in coming months.