December 01 2014

elb2

While oil prices decline and analysts ponder the weekend’s shopping data from the US, the exchange world is fairly quiet post Thanksgiving. Some interesting nuggets though, so worth a scroll including Silver Lake nearing a deal to sell turret provider IPC while Warsaw gets innovative about ratings, SEBI looks for new fraud detection software, BIST launches Sukuk bonds and FTT is rumoured to be suffering disagreement amongst the EU 11 but once again nobody has put a stake through its heart to kill it…

Happy scrolling and greetings from a foggy London.

Public Markets

Centerbridge Nearing A Deal To Buy IPC Systems From Silver Lake (subscription)
Dana Mattioli & Mike Spector – Wall Street Journal

Centerbridge Partners LP is nearing a deal to buy IPC Systems Inc., a communications company for financial trading, for more than $1.1 billion including debt, according to people familiar with the matter.

IPC is owned by Silver Lake, a technology-focused private-equity firm which bought IPC in 2006 for about $800 million.

Silver Lake started exploring a sale of IPC earlier this year and a deal with Centerbridge could be announced as soon as this week.

PLY: Interesting business IPC, although it has struggled to grow in the challenging era for dealing rooms since Silver Lake acquired it in 2006.

CERC Gives More Time To FTIL For Completing IEX Stake Sale
Business Standard

Electricity watchdog CERC has given FTIL time till January 4 to comply with its directive to complete sale of its entire stake in Indian Energy Exchange (IEX).

A few weeks ago FTIL had inked a deal to offload its entire 25.64% shareholding in IEX for more than Rs 576 crore (USD 93.9 mln). The completion of the deal subject to regulatory and other approvals.

In its latest order, CERC said that FTIL has been pursuing the divestment process in compliance with its order.

Warsaw Will Go Organic: New CEO
Lucy Fitzgeorge-Parker – Euromoney

Warsaw SE (WSE) is hoping to attract listings from companies across emerging Europe after abandoning plans for merger talks with Vienna’s CEESEG.

Pawel Tamborski, who took over as head of emerging Europe’s largest bourse in July, tells Euromoney that, following a two-month strategic review, the WSE’s new management team has decided to focus on organic growth rather than pursuing a tie-up with its smaller rival.

PLY: Repeating what we have heard before but the crucial issue is that WSE is increasingly perceived locally as having lost momentum while going through CEOs and squandering time on the world’s most ludicrous exchange merger proposal. Moreover, the political climate in Poland remains cloudy as the government appears bereft of inspiration and struggling to run the country constructively.

That said, congratulations once again to the innovative grain warehousing company Feerum who won a richly deserved award at the European Issuers / FESE SME awards last week in Brussels.

Moscow Market Reforms Battle Capital Flight
Elliott Holley – Banking Technology

Despite tensions between Russia and NATO over the situation in east Ukraine, the underlying internationalisation and reform agenda in Moscow has not changed.

PLY: Fair point. Development of the Moscow financial centre project continues apace and various precepts of corporate law are being improved while MOEX remains the only Eastern European exchange genuinely firing on all cylinders right now (despite macroeconomic hiccoughs).

‘Collaboration of Nigerian, Johannesburg Exchanges Would Create Opportunities For Investment, Economic Growth’
Olawunmi Ojo – NGR Guardian News

Recently, top directors of Johannesburg SE (JSE), South Africa were in Lagos to firm up a working partnership with Nigerian SE (NSE).

LBMA Takes Stake In Gold, Platinum, Palladium Benchmarks
Reuters

LBMA will take on intellectual property rights for gold, platinum and palladium price benchmarks when they are launched by new administrators (ICE in gold and CME/Thomson Reuters in silver, while LME will run platinum and palladium fixes).

Private Markets

NSE’s Clearing House Calls For Guarantee Fund
Business Standard

NSE’s clearing corporation, NSCCL, has called for contribution from clearing members for its core settlement guarantee fund (SGF) across three segments — equity, equity derivatives and currency derivatives.

Indian Power Exchanges Expect Volume To Grow Due To SAARC Energy Co-Operation Deal
Sanjay Jog – Business Standard

Indian Energy Exchange (IEX) and Power Exchange India (PXIL) expect that the energy deal signed by the South Asian Association for Regional Cooperation (Saarc) on energy cooperation would be a big boost to the sector.

Special Section: FTI, NSEL, India at the Crossroads

PLY: MCX and FTIL flat.

Technology

SEBI Decides To Upgrade Software For Fraud Detection
The Economic Times

SEBI has invited bids from agencies to work on the design, supply, installation, configuration and maintenance of the system.

ASIC’s Tech Approach To Regulation Heightens As Digital Disclosure Introduced
Andrew Saks-McLeod – LeapRate

Australian Financial Services Commission (ASIC) announced a joint industry project to develop innovative, digital financial product disclosure that aims to boost investors’ understanding of financial products.

Products

FTT Stalls On Derivatives Agreement (subscription)
Tim Cave – Financial News

PLY: Latest sticking point for the 11 nations seeking suicide through transaction tax is application to derivatives markets while time is running out for an agreement by year’s end as scheduled. That said every time optimism grows that the proposal may die, it rises like a zombie in a Milla Jovovich movie.

Thin Turnover Expected In Debut For HKEx Metal Contracts (subscription)
Enoch Yiu – South China Morning Post

Zinc, copper and aluminium futures denominated in yuan launched on HKEx.

BIST Rings Bell For Sukuk
Trend

The Islamic Development Bank’s six sukuk worth over $6 billion began trading at BIST Friday with various maturity dates until Sept. 2019.

PLY: A healthy start to the BIST move towards Sukuk in parallel with its existing traditional bond market.

DIY Exchange Ratings Tackle Bond Risk: Poland Credit
Konrad Krasuski – Bloomberg

Five years after creating a $9 billion tradable corporate bond market, Warsaw SE (WSE) has a problem: it’s hard to distinguish the credit risk of one listed Polish company from another.

With two-thirds of the Catalyst trading system’s 351 listed debt securities valued at less than $10 million each, most fall under the radar of the global rating companies. The bourse plans to plug the coverage gap by providing its own credit assessments from H2 2015.

“Our service will help investors differentiate the notes and better understand issuer credit risk,” Maja Goettig, CEO of in-house ratings provider Instytut Analiz i Ratingu SA, said in a Nov. 26 interview in Warsaw. “Our challenge is to strengthen the market’s creditworthiness.”

PLY: An interesting project as GPW thinks a little outside the box to develop ratings for smaller bonds – good luck to them.

BIST To Offer Options Revenue Sharing (subscription)
FOW

Financial Calendar

This week

Record date Interactive Brokers Q3 $0.10 dividend
TMX $0.40 Q4 dividend payment
Record date LSEG 9.7 pence interim dividend

All forthcoming exchange / investment related events are now listed in our Events page.

Share Notes

Interactive Brokers CFO Paul Jonathan Brody sold 4,733 shares Wednesday, November 26th at an average price of $27.46 (bargain $129,968.18). Mr. Brody’s regular sales are chronicled on this specific page.

Crowdfunding

Crowdfunding: We Need To Talk About The Elephant In The Room
Rebecca Burn-Callander – Daily Telegraph

This week, the London Co-Investment Fund backed by Boris Johnson will announce that it has selected six partners to manage £25m worth of taxpayers’ money, which is to be funnelled into new and exciting technology businesses based in the capital.

The Telegraph has received a tip off revealing that one of these partners is the crowdfunding platform Crowdcube.

The sector has officially come of age.

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