These investments are expected to be the first in a series of strategic investments by securities industry firms designed to advance the PHLX’s goal of growing its business, supported by state of the art technology.
“This investment by Merrill Lynch and Citadel in the PHLX is truly a turning point in the evolution of the Exchange,” said Meyer “Sandy” Frucher, chairman and CEO of the PHLX. “Our market model will benefit enormously by the commitment from Merrill Lynch, one of the largest and most respected broker dealers in the world, and of Citadel, one of the largest and most successful participants in the global cash and derivatives markets.”
“With its advanced technology, the PHLX is well-positioned to compete in the dynamically evolving options and derivatives marketplace,” said Managing Director, Rohit D’Souza, head of Global Equity Trading at Merrill Lynch. “Our clients want quality executions delivered quickly and economically from a range of trading venues, and PHLX's low-cost, electronic platform will help us to meet those demands."
"Our investment in the PHLX reflects our belief that electronic markets are inherently faster, more efficient and fairer," said Matthew F. Andresen, President of Citadel Execution Services. "We have been impressed with the Exchange’s record of technology innovation and vision for the future. Together with Merrill Lynch, we look forward to helping grow and strengthen this important market."
Since its demutualization in January 2004, when it converted from a seat-based to a share-based corporate structure, the exchange has been well-positioned to bring in strategic investors. The commitments by Merrill Lynch and Citadel to the PHLX, which will dilute original shareholders, will enhance the Exchange’s multi-pronged strategy.
In particular, the move will add greater strength to its options model, which is built on a strong proprietary technology, and features directed order flow and remote market making functionalities that are superior to any other options exchange in breadth of product, allocation and cost.
The Philadelphia Stock Exchange was founded in 1790. The PHLX trades 2,000 stocks, 1,650 equity options, 22 sectors index options and currency options and futures. For more information about the PHLX and its products, visit www.phlx.com.
