(
)
An upstart Atlanta entrepreneur has captured the Big Board — the 220-year-old beating heart of Wall Street capitalism — in a surprise deal that has eluded far more established suitors for years.
Jeffrey Sprecher’s 12-year-old IntercontinentalExchange — which he built from an obscure power company in Georgia into a key trader for energy and commodities derivatives — revealed an $8.2 billion deal to buy Big Board parent NYSE Euronext yesterday.
The deal will transfer control of the city’s symbolic financial center to Sprecher, 57, who will be CEO of the trading behemoth. NYSE chief Duncan Niederauer will be president.
A former race car driver, Sprecher, has proven to be an even faster and more nimble dealmaker.
The price he paid was $3 billion cheaper than the $11 billion joint offer made nearly two years ago by ICE and Nasdaq, the NYSE’s main rival. That attempt was killed by regulators due to antitrust concerns.
A separate bid for NYSE earlier this year from Germany’s Deutsche Boerse was also nixed by European regulators, weakening the value of the Street icon.
Sen. Chuck Schumer (D-NY), an aggressive defender of Wall Street, said he received assurances from the new owners that the historic trading floor — sparsely occupied now — and its jewel landmark building at 11 Wall St. won’t be turned into condos.
“I am pleased they will keep the New York Stock Exchange name and protect the brand,” Schumer said, adding that the new company will have dual headquarters in Atlanta and on Wall Street.
Sprecher’s terms persuaded the 775 stockholders of NYSE Euronext to the accept his deal to protect the operation from shrinking any further.
Most trading for financial products is done largely on computers with little need for face-to-face contact. The image of the once-hectic trading floor has all but vanished at the Big Board.
Experts said futures contracts are growing and will account for most of the profits in the new company. Futures contracts are written and traded at specific exchanges, while stocks can be traded anywhere in the world.
The global NYSE group was created in 2007, when the Big Board paid $10.3 billion for Euronext, which included stock markets in Paris, Amsterdam, Brussels and elsewhere. It has expanded to run stock markets in London, Lisbon and Qatar.
The Big Board has been mired in a trading slump amid record low interest rates. Its fortunes have also declined rapidly over the past decade because of changing technology, new regulations and the shifting needs of global investors.
Despite its shrinking clout, the revenue of the NYSE group was $4.55 billion last year, more than triple the projected $1.4 billion in revenue of ICE.
ICE closed at $130.10, up $1.79. NYSE Euronext jumped 34 percent, or $8.20 a share, to $32.25, on the takeover news.