CBOE Holdings agreed to buy Bats Global Markets, in a move that combines one exchange operator known for its product development with another that’s known for its technology.
“The acquisition of Bats is expected to strengthen our position as a global leader in innovative tradable products and services, and is a transformative next step in our growth strategy,” CBOE Chief Executive Officer Ed Tilly said in a release. “We believe that bringing together CBOE Holdings’ product innovation, indexing expertise, and options and volatility market position, with Bats’ proven proprietary technology infrastructure, global ETP listing and trading venues, global foreign exchange marketplace and market data services, represents a compelling combination that should deliver significant benefits for our customers.”
CBOE’s eponymous options exchange is the largest of 14 in the U.S., with market share of 26.4% this month, according to OCC data. Chicago-based CBOE has a virtual stranglehold in the index-options business via its dominant CBOE Volatility Index (VIX) product. The exchange operator also runs the C2 all-electronic options exchange and the CBOE Futures Exchange.