Acquisition of NEX Exchange
5 July 2019
Aquis Exchange PLC
("Aquis", the "Company" or the "Group")
Acquisition of NEX Exchange
Aquis Exchange PLC (AIM: AQX), the exchange services group that operates pan-European cash equities trading businesses and develops and licenses exchange software to third parties, is pleased to announce that it has agreed to acquire NEX Exchange Limited ("NEX Exchange") from CME Group Inc. (the "Acquisition") for a cash consideration of £1, plus approximately £2.7 million based on NEX Exchange's current working capital levels.
NEX Exchange, the UK based stock market for growth enterprises, is one of only four equities-focused Recognised Investment Exchanges (RIEs) in the UK. It works with 51 registered brokers, 7 market makers and 89 companies currently listed on its two markets with a combined market capitalisation of approximately £1.9 billion.
This Acquisition is another step in Aquis' ambition to become the leading exchange services group in Europe and provides a unique opportunity to acquire an RIE business with a focus on primary markets in a cost and time effective manner. Underpinned by the Group's proven technology and a track record of transparency and innovation, the Board believes that with Aquis' experience in both building new businesses in the exchange industry and also increasing liquidity, it has the ability to transform NEX Exchange at a time when MiFID II implications and other factors make the industry ripe for innovation. The Board believes that the Acquisition provides a unique opportunity to build a pan-European, technology driven, listing exchange for growth companies.
Based on the audited financial accounts for the year ended 31 March 2018, NEX Exchange delivered revenues of £1.51m and a loss before tax of £2.05m. The Company believes that significant cost savings can be delivered in the short term, significantly reducing the loss in the initial period following the Acquisition.
Completion of the Acquisition is expected this autumn, subject to FCA approval. The Company will update the market upon receipt of FCA approval and completion.
Alasdair Haynes, Chief Executive Officer of Aquis, commented:
"Our stated aim is to become the leading technology-driven exchange services group, and this acquisition is a milestone towards delivering this vision. We have a successful blueprint of proven technology and are confident that we can not only deliver growth but we can also positively address the current issues in small and mid-cap trading. We have the capability, capacity and ambition to drive further shareholder value through this transaction."
Ken Vroman, Senior Managing Director, Cash Markets and Optimization Services, CME Group, commented:
"We are pleased to have reached an agreement with Aquis Exchange to acquire NEX Exchange from CME Group. There are natural synergies between the two companies, and we believe Aquis is well positioned to take NEX Exchange to the next level of its growth."
This announcement contains inside information for the purposes of Article 7 of EU Regulation 596/2014 (MAR).
Management will host a conference call for analysts at 8:30am today regarding the Acquisition. Please contact [email protected] for dial in details.
Aquis Exchange PLC
Tel: +44 (0) 20 3597 6321
Alasdair Haynes, CEO
Jonathan Clelland, CFO and COO
Belinda Keheyan, Head of Marketing
Tel: +44 (0) 7768 078110
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Liberum Capital Limited (Nominated Adviser and Broker)
Tel: +44 (0) 20 3100 2000
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Alma PR (Financial PR Adviser)
Tel: +44 (0)20 3405 0209
About Aquis Exchange
Aquis Exchange PLC is an exchange services group, which operates a pan-European cash equities trading business (Aquis Exchange) and develops and licenses exchange software to third parties (Aquis Technologies).
Aquis Exchange PLC (AQX.L) is quoted on the London Stock Exchange's Alternative Investment Market (AIM).
Aquis Exchange is authorised and regulated by the UK Financial Conduct Authority and France's Autorité des Marchés Financiers to operate Multilateral Trading Facility businesses in the UK and in EU27 respectively.
Aquis operates a lit order book and does not permit aggressive non-client proprietary trading, which has resulted in lower toxicity and signalling risk on Aquis than other trading venues in Europe. According to independent studies, trades on Aquis are less likely to lead to price movement than on other lit markets. Aquis applies a subscription pricing model which works by charging users according to the message traffic they generate, rather than a percentage of the value of each security that they execute. This model can significantly reduce the cost of trading.
Aquis Technologies is the software and technology division of Aquis Exchange PLC. It creates and licenses cutting-edge, cost-effective matching engine and trade surveillance technology for banks, brokers, investment firms and exchanges.
This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact [email protected] or visit www.rns.com.
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