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Nasdaq explores Europe
Parent of Nasdaq seeks to link to London and German exchanges
April 24, 2000: 5:26 p.m. ET
NEW YORK (Reuters) - The parent of the Nasdaq wants to link its electronic marketplace with the leading German stock exchange and the London Stock Exchange (LSE), which themselves are in the final stages of a drawn-out merger process, say people familiar with the matter.
The plan to link into the market created from the merger of the Deutsche Bourse and the LSE would give Nasdaq a gateway into trading European stocks in a well-established, competitive marketplace.
The National Association of Securities Dealers, Nasdaq's parent, would still press forward with its own plan to build a sibling electronic market in Europe, but this linkage would enhance its ability to gain access to issues that trade on two of Europe's biggest stock markets, sources said. The Deutsche Bourse, formally known as the Frankfurt Stock Exchange, runs Germany's main stock market and the world's No. 1 derivatives exchange.
NASD and Nasdaq officials declined to comment on the possible linkage, but sources close to the matter said the NASD has been in talks with the two exchanges for some time. The main holdup is that those two markets are trying to hash out a merger agreement of their own, the sources said.
The Deutsche Bourse and the LSE have entered a make-or-break stage this week, as the Frankfurt exchange operator insists on a conclusion well ahead of its May 4 shareholder meeting. If no merger is agreed to by then, the bourse will press ahead with plans to float itself as a publicly traded company.
Nasdaq, the No. 2 U.S. stock market, grabbed headlines last year when it announced it would build sibling markets in Japan and Europe. The idea behind the expansion is to erect a global electronic stock market that would trade the world's most liquid stocks 24 hours a day, seven days a week.
The Nasdaq recently struck a deal to make its Nasdaq market in Japan a unit of the Osaka Stock Exchange. Nasdaq's partner in its Japanese venture is Internet investment company Softbank Corp. In addition to Softbank, Nasdaq's partners in its European venture are Australian media giant News Corp. and the venture capital arm of France's Vivendi.
Nasdaq plans to base its Nasdaq Europe in London, but it would be open to all European companies interested in listing on the technology-heavy market. Nasdaq is planning to launch its Japanese market by the end of this year and the European counterpart in early 2001. |
