The European Energy Exchange (EEX), a part of Deutsche Börse Group, confirmed today that it has reached an agreement in principle to purchase all shares of the US futures exchange Nodal Exchange Holdings. By acquiring a full control on the Virginia-headquartered exchange, EEX hopes to further promote Deutsche Börse Group’s North America strategy.
Founded in 2007, Nodal Exchange is a derivatives exchange providing price, credit and liquidity risk management to participants in the North American energy markets. The regulated exchange currently offers over 1,000 contracts on hundreds of different locations, providing market participants with effective risk management tools.
Nodal Exchange is a privately held company whose owners include private equity firm DC Energy, Macquarie Energy and clean energy giant NextEra. All transactions on the exchange are cleared through its clearing house, Nodal Clear, which is a CFTC registered derivatives clearing organization (DCO).
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With the acquisition of Nodal, EEX group expands its product and service offering to a global reach with a presence in new markets and products which complements the existing portfolio. Furthermore, this deal is a further step in implementing Deutsche Börse Group´s growth strategy ‘Accelerate’.
The purchase price for the entire transaction will be in the low three digit million US dollar range, the bourse said. The binding agreement is subject to final approval of the shareholders and the CFTC, which serves as the exchange’s primary regulator. Upon the close of the transaction, which Deutsche Börse expects to be immediately accretive to its net income, Nodal Exchange will be a wholly-owned subsidiary of the Germany’s paramount exchange.
Carsten Kengeter, CEO of Deutsche Börse AG, who is being investigated over possible insider trading, commented on the initial deal: “Our clear vision is to turn Deutsche Börse into the global market infrastructure provider of choice, top-ranked in all its activities. With Nodal as part of our group, we will be able to provide an even broader trading and clearing portfolio, enhancing our global footprint and membership base; ultimately supporting our customers’ needs for trading across a variety of markets and geographic zones.”