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Deutsche Boerse continues buying spree with small MTF

German exchange operator Deutsche Boerse widened its reach to smaller private investors with a deal to buy multilateral trade facility (MTF) Tradegate.

Tradegate, the second largest market for private investors in Germany, offers brokers longer trading hours, alternative order types and pricing structures which are not offered at Deutsche Boerse.

According to Tradegate data, the number of transactions on its platform rose 44% in 2008 to 2.3 million, in stark contrast to most European equities markets. Total trade volume in 2008 was just under €10 billion.

Deutsche Boerse gave no details about how much it paid for a 75% plus one share stake but said that it was under €10 million ($14.93 million).

This is the third small purchase by Deutsche Boerse in the last month after it bought index provider Stoxx ltd from Dow Jones & Co for around €200 million and US financial news service Need to Know News for around €1 million.

Deutsche Boerse is also the sole bidder for a controlling stake in the state-owned Warsaw Bourse, but it said over the weekend that it would not increase its bid.

Poland's Deputy Treasury Minister Joanna Schmid said on Monday the Warsaw exchange might be floated instead.

“Through this purchase we are further advancing into the growing private investor segment,” the head of the Deutsche Boerse's cash equities operations, Frank Gerstenschlaeger, told Reuters. He said the segment is expected to grow on both the domestic and international level.

Gerstenschlaeger said the new exchange was unlikely to compete with its existing trading platforms including the newly created Xetra International Markets segment, the Xetra trading system or traditional floor trading. (Reuters)