The European Commission today announces that it has approved, under the EU Merger Regulation, the acquisition of joint control over a newly created joint venture by IHS Markit Ltd and CME Group Inc.
The joint venture will consist of IHSM’s over-the-counter derivatives and foreign currency trade processing business (MarkitSERV) and of CME Group’s OTC derivatives optimisation businesses (Traiana, TriOptima and Reset). Through these businesses, the joint venture will provide trade processing and trade/portfolio optimisation services in a number of asset classes.
IHSM is a global provider of information, analytics, expertise, and solutions to major industries, financial markets, and governments. CME is a global risk management firm that owns and operates several exchanges and provides other trading and clearing services across a range of asset classes, including commodities, equity indices, FX, IRDs and cryptocurrencies.
The proposed transaction is largely complementary, and results in a few technically overlapping areas between the companies’ activities relating to trade processing products.
The Commission’s investigation also showed that any strategy to foreclose competitors following the transaction would be unlikely. Therefore, the Commission concluded that the proposed transaction would raise no competition concerns.
The transaction was examined under the normal merger review procedure.
In January 2021, international derivatives marketplace CME Group (NASDAQ:CME) and IHS Markit (NYSE:INFO), a global provider of critical information, analytics and solutions, announced that they have agreed to combine their post-trade services into a new joint venture.
The new company will include trade processing and risk mitigation operations. It will incorporate CME Group’s optimization businesses –Traiana, TriOptima, and Reset – and IHS Markit’s MarkitSERV.
The combination of these complementary offerings will provide clients with enhanced platforms and services for global OTC markets across interest rate, FX, equity and credit asset classes. Market participants will benefit from a more efficient front-to-back workflow with enhanced connectivity and improved trading certainty.
As a result, OTC market participants will be able to improve risk management and streamline post-trade operations.