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- The Warsaw Stock Exchange (GPW), Towarowa Giełda Energii (TGE), the Hungarian National Bank and the Budapest Stock Exchange have signed a Term Sheet with a view to establishing Central Post-trade Solutions (CPS) on or before 30 September 2022.
- Under the Term Sheet, Towarowa Giełda Energii will be the majority shareholder of the company to be established
- The provisions of the Term Sheet are not binding and the conclusion of the investment agreement will depend, among others, on GPW and TGE conducting a due diligence and obtaining required corporate approvals
On 16 December 2021, the Warsaw Stock Exchange (GPW), Towarowa Giełda Energii (TGE), the Hungarian National Bank and the Budapest Stock Exchange have signed a Term Sheet with a view to establishing a commodity market post-trade operator Central Post-trade Solutions (CPS) on or before 30 September 2022. Under the Term Sheet, Towarowa Giełda Energii will be the majority shareholder of the company to be established.
The Term Sheet sets out the framework for further negotiations. The final wording of the potential investment agreement may differ from the initial assumptions. The provisions of the Term Sheet are not binding and the conclusion of the investment agreement will depend, among others, on GPW and TGE conducting a due diligence and obtaining required corporate approvals.
“I wish to congratulate GPW President Marek Dietl on his idea and initiative. A large-scale vision and the aspiration to grow internationally create value and demonstrate responsibility for the entire Polish economy. It is truly exemplary,” said Jacek Sasin, Deputy Prime Minister and Minister of State Assets.
“Integration of Polish and Hungarian business within the company Central Post-trade Solutions will generate synergies in the development of a comprehensive clearing offer for the entire region. The potential transaction will allow for the formation of an entity with a comprehensive offer for commodity markets including markets in electricity, gas and agricultural products. The cooperation with our Hungarian friends will allow TGE to introduce new business lines and provide many benefits to other participants in CEE/SEE,” said Marek Dietl, President of the Management Board of GPW.
Development and growing competition on commodity markets in the CEE/SEE region, including in particular in the area of clearing services, pose new challenges for entities operating in this market. To address those challenges, international cooperation projects need to be implemented with a view to the development of CEE/SEE commodity markets (mainly energy and gas markets), including in particular the development of post-trade services. The objective of this project is to create a leading CEE/SEE clearing house for commodity markets which can compete with other such entities in Western Europe thanks to, among others, its business scale, comprehensive offer and cost synergies. The new entity can also cooperate with multiple local energy and gas markets in CEE/SEE countries by providing services in new projects implemented in this part of Europe. The establishment of CPS will also enable the development of the Financial Instrument Market operated by TGE by introducing new products to the market.
“The agreement signed today and a future investment agreement with the Hungarian partners will create a new quality in post-trade services for commodity markets, mainly for power and gas, in Central Europe. We hope that the new solution we are working on with the Hungarian partners will strengthen and accelerate the development of commodity markets in CEE and SEE and reinforce TGE’s strategic position in the CEE region,” said Piotr Zawistowski, President of the Management Board of TGE.
“Combining KELER CCP and IRGiT will allow all parties to strengthen their post-trade infrastructure and explore new business opportunities,” said Richard Végh, CEO of Budapest Stock Exchange.
