NYSE Euronext to be bought by ICE

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The venerable New York Stock Exchange has aggred to be bought by Atlanta-based ICE for $8.2 billion.

ICE was most interested in the NYSE's Liffe derivatives operations. Indeed, it will likely sell off various overseas stock exchanges after the deal closes. The merger shows clearly how the securities business has changed over the past decade. Stock trading matters much less than derivatives trading, which continues to shift to exchange-based markets and central clearinghouses.

In this shifting universe, the ICE has emerged as derivatives powerhouse with a strong streak of ambition. It has failed in bids to buy the NYSE (in a joint deal with Nasdaq), the CBOT and the LME. But it has been successful in buying numerous smaller exchanges.

As for NYSE Euronext, it apparently sees the need to do something transformative for shareholders. After its disastrous attempts to merge with Deutsche Bourse, many thought it would opt to remain independent, but management had other ideas. That they are willing to sell to a derivatives exchange speaks volumes about where they think the industry is heading.

The really interesting news has yet to be released. Who will run the combined entity? Will it be Duncan Niederauer, who some think has been tarnished a bit by his rocky tenure at NYSE Euronext? Or will it be Jeffery Sprecher, the founder of the company, whose roots are in engineering? He's hardly a household name, but he just might assume command of an important exchange company. UPDATE: Sprecher will assume the CEO spot of the combined company, while Niederauer will become president. 

For more:
- here's an article from the FT