Nasdaq Acquires Chi-X Canada to Tap into Canadian Equities Market

The acquisition will help expand Nasdaq’s North American equities presence, whilst fortifying its business abroad.

Nasdaq (Nasdaq: NDAQ) has officially acquired Chi-X Canada, an Alternative Trading System for the Toronto Stock Exchange (TSX) and TSX Venture Securities, from Chi-X Global.

The newly approved acquisition is instrumental for Nasdaq which will gain direct access to the Canadian equities market. Despite the approval of the deal by regulatory authorities, the actual acquisition is slated to close in Q1 2016.

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Chi-X Canada is owned by a group of major financial institutions and operates market centers in Australia, Canada and Japan. Chi-X Canada is a high-performance alternative trading system (ATS) marketplace for the trading of TSX and is the largest ATS system in Canada. The deal was originally in the works and made public last month, which was nearly a sum of $100 million, as reported by Finance Magnates.

In particular, the acquisition will help expand Nasdaq’s North American equities presence, whilst fortifying its business abroad. The deal will also look to augment the aggregate trading experience for customers across both Canadian and domestic venues. To help accomplish this, Nasdaq will be working closely with Chi-X Canada’s clientele to create a streamlined transition to its INET exchange technology.

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As a result of the acquisition, Dan Kessous, Chi-X Canada acting Chief Executive Officer (CEO), will still be expected to lead the Canadian equities trading business with the Chi-X Canada team joining Nasdaq.

According to Hans-Ole Jochumsen, President, Nasdaq, in a recent statement on the acquisition, “This acquisition is an important part of our North American strategy as Chi-X handles about 22% of the order flow of S&P/TSX Composite securities in Canada. The addition of these thriving marketplaces will create a powerful combination for investors.”

“Nasdaq and Chi-X Canada have both demonstrated their commitment to market innovation and efficiency. We believe Nasdaq is well positioned to enhance Chi-X Canada’s current capabilities and to capitalize on new product and asset class opportunities, while maintaining Chi-X Canada’s core values of cost-effective and client-driven solutions,” added Tal Cohen, CEO of Chi-X Global, in an accompanying statement.

“This is a significant acquisition for Nasdaq, as Canada’s GDP has grown more than 50% in U.S. dollars, and 16% inflation-adjusted, since 2005. We look forward to working with the Chi-X Canada clients to develop new products and services to help them better navigate the global capital markets,” reiterated Tom Wittman, Executive Vice President, Global Head of Equities, Nasdaq.

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