Eurex US appoints new CEO, acquires BrokerTec exchange

Eurex US is currently seeking approval as a regulated US exchange from the Commodity Futures Trading Commission (CFTC).

It was also announced this week that Joseph J. Murphy, Chief Executive Officer of REFCO Global Futures, will join the Eurex US Board of Directors representing independent clearing firms. This follows last week’s appointments of Kaushik I. Amin of Lehman Brothers Inc., Bradford S. Levy of Goldman, Sachs & Co. and Jeffrey D. Jennings of Morgan Stanley & Co to the Eurex US Board.

Nandapurkar joins from the Chicago Mercantile Exchange, where he has served as Managing Director and Head of Products and Services, responsible for sales and marketing, product management, and overseas offices. He had originally joined CME as Head of e-Business in 2000.

Nandapurkar’s previous experience includes senior management roles at Swiss Bank Corporation from 1991 to 1996, where he had served as Managing Director and Global Head of Exotic Options, as well as having served as Managing Director and Global Head of Foreign Exchange Options at Bank of America from 1997 to 1999, based in New York and Chicago.

BrokertTec Acquisition adds 17 new partners

Eurex US confirmed that it has added 17 new equity partners to its new exchange with the acquisition of BrokerTec Futures Exchange (BTEX).

These institutions would hold through Exchange Place Holdings, L.P. (formerly BTEX Holdings, L.P.) a 20 percent equity interest in Eurex US and would appoint three directors to the 12 member Board of Directors of the new exchange.

The Exchange Place Holdings consortium will comprise 17 shareholders, including Citigroup Global Markets Inc., Deutsche Bank Securities Inc., Goldman Sachs & Co., Lehman Brothers Inc., Man Financial Inc., Morgan Stanley & Co. Inc., and Refco LLC or their respective affiliates.

Together with three additional directors from proprietary trading/arbitrage firms, institutional investors and independent clearers, the acquisition ensures that the US futures industry will have a substantial representation on the Eurex US board.

The equity partnership will be facilitated by a merger of BrokerTec Futures Exchange (BTEX) and a subsidiary of Eurex US. Eurex US would acquire the assets, including the staff and the goodwill, of BTEX, but would not acquire any of the liabilities of BTEX.

In addition, the seven shareholder firms mentioned above or their affiliates have agreed to make individual revenue commitments to Eurex US in consideration for the receipt of an increased equity interest. These firms expect to become active participants on the new exchange from its launch, which is scheduled for February 1, 2004, subject to CFTC approval.

The aggregate revenue commitments total USD 18 million over 36 months and are creditable only against exchange fees payable for proprietary and non-discretionary customer orders. The agreements do not include any arrangements involving compensation or credits for directing discretionary customer orders to the new exchange. The revenue commitment agreements have been submitted to the CFTC for review.

Eurex CEO Rudolf Ferscha said: “The participation of these leading industry players in Eurex US through this equity partnership underscores the support for the Eurex US market model and the demand in the industry for a level playing field and low cost exchange. The governance of Eurex US will greatly benefit from the participation of a wide range of US industry participants from all major user groups.”

 copyright hedgeweek 2004