According to a report by Reuters, Kansas City headquartered exchange operator BATS Global Markets is in negotiations to acquire KCG Hotspot from KCG Holdings Inc. The deal is said to be valued at $400 million, according to anonymous sources.
KCG has been on the lookout to sell its foreign exchange Electronic Communication Network (ECN) KCG Hotspot since October last year, when it announced that it was exploring strategic options for the foreign exchange unit.
At the time, KCG’s earnings report outlined, “KCG has not made a decision to enter into any transaction at this time, and there can be no assurance that KCG will enter into such a transaction in the future.”
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KCG Holdings own about 16.5% of BATS, and the deal is said to be in advanced stages of negotiations.
While the Reuters report confirms talk about a prospective deal, there has been no verification about whether or not BATS will be acquiring one of the biggest ECNs in the foreign exchange market.
On January 15th, when the Swiss ‘black swan’ hit the market, KCG Hotspot reported its highest volume turnover ever, with 61.7 billion changing hands on the ECN platform.
Shares of KCG Holdings (NYSE:KCG) traded higher by 4.24% on Saturday.