The ASX could have a larger force of a rival to deal with, as Chi-X Asia Pacific has secured a new owner, global market operator and trading solutions provider Cboe.
Vic Jokovic, chief executive at Chi-X Australia indicated the transaction will allow his company to boost its competitive position.
For Cboe, the deal has provided an entry into two key capital markets, Australia and Japan, enabling it to expand its global equities business in the Asia Pacific.
The company has also signalled plans to convey over its other products and services to the region, including its block trading capabilities, as well as further expand access to its product suite.
“This is an exciting investment in attractive, growing markets that will complement our North American and European operations and provide a foothold in the key Asia Pacific region, positioning us to become a truly global marketplace for our customers,” Ed Tilly, chairman, president and chief executive at Cboe Global Markets said.
“In a short number of years, the Chi-X Asia Pacific team has built their business into one of the largest market operators in Asia Pacific. We look forward to working with them to accelerate the company’s further growth, building on our shared cultures of innovation and customer-first approach as we aim to bring greater choice to investors in Asia Pacific.”
Chi-X Australia is the country’s second-largest securities exchange, holding an 18.4 per cent total market share and offering trading in all Australian-listed securities.
Meanwhile the exchange’s Japanese arm is the third-largest equities venue in its market, with a 2.7 per cent market share.
Chi-X Asia Pacific generated around $26 million in net revenue for the 2020 year, a 26 per cent increase on the year before.
David Howson, currently president of Cboe’s European operations will lead the company’s business expansion into the region in his newly promoted position, as president, Europe and Asia Pacific.
Mr Jokovic and Toru Irokawa, representative director and president at Chi-X Japan, will continue to lead their businesses.
“We are excited to draw upon Cboe’s core strengths as a leading global exchange operator to further enhance the competitive landscape in the Australian markets with new innovation and market solutions to better meet customer needs,” Mr Jokovic said.
The deal has also presented Cboe with an opportunity to make gains in equities market data, with it now having access to data from most major markets, including the US, Canada, Australia, Japan and 15 European countries.
The transaction is expected to close in the second or third quarter.
Sarah Simpkins is a journalist at Momentum Media, reporting primarily on banking, financial services and wealth.
Prior to joining the team in 2018, Sarah worked in trade media and produced stories for a current affairs program on community radio.
You can contact her on [email protected].