IntercontinentalExchange is to acquire The Clearing Corporation of Chicago as it gears up for the launch of a central counterparty clearing system for the credit default swaps market in conjunction with nine global dealers.
Under the terms of the agreements, ICE will acquire TCC and will form ICE US Trust, a New York limited purpose trust company with the support of Bank of America, Citi, Credit Suisse, Deutsche Bank, Goldman Sachs, JPMorgan, Merrill Lynch, Morgan Stanley and UBS.
All shares in CCorp were held by the nine banks, plus Eurex, GFI Group, Icap, Creditex, and Markit under a major restructuring effected in December last year.
The latest move comes as the Federal Reserve sets a Friday deadline for competing initiatives to detail their plans for the creation of a new clearing counterparty for $55 trillion credit default swaps market.
ICE is competing with the CME and Citadel, Eurex and Nyse Euronext for the regulatory green light for its proposals. The company says its plaform is currently undergoing final testing in preparation for a launch later in Q4.
ICE chairman and CEO Jeffrey C. Sprecher, comments: "We have made a commitment to developing a market structure that reduces risk and increases transparency and capital efficiency in these important global markets, first through our acquisition of Creditex, and now through our planned acquisition of The Clearing Corporation."