Cboe Global Markets is planning to launch Cboe Europe Derivatives as soon as the first half of 2021 with the completion of the acquisition of EuroCCP, a pan-European equities clearinghouse.
EuroCCP currently clears trades for 37 trading venues, which represent close to 95 percent of all equity trades executed on organized markets in Europe. It will be responsible to provide clearing services for the upcoming derivatives platform.
Commenting on the development, Ed Tilly, chairman, president and chief executive officer of Cboe Global Markets, said: “This acquisition is a significant milestone for our European business. Full ownership of a leading equities clearing house not only enhances our current European equities business, but also provides opportunities to diversify our business into trading and clearing derivatives in the region. We are delighted to welcome the EuroCCP team to Cboe Global Markets.”
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Strategic acquisition to expand European presence
As a part of the deal, EuroCCP put in place a committed credit facility of up to €1.5 billion ($1.68 billion). This will strengthen the firm’s liquidity risk management framework and ensure the meeting of relevant liquidity requirements under the European Market Infrastructure Regulation (EMIR).
Per the press release, the upcoming Amsterdam-based operation will initially offer trading in equity futures and options based on six Cboe Europe Indices – the Cboe Eurozone 50, Cboe UK 100, Cboe Netherlands 25, Cboe Switzerland 20, Cboe Germany 30, and Cboe France 40.
“This deal marks the beginning of the next chapter for Cboe Europe,” David Howson, President of Cboe Europe, said. “We have listened to the needs of market participants and are designing this new market from a pan-European point-of-view, leveraging our global derivatives expertise, European equities footprint, and world-class technology to build a more efficient equity derivatives market.”