DTCC buys their way into Europe Wednesday, October 22, 2008
After many years of fruitless toil in Europe [read London], DTCC has evidently decided to rapidly accelerate Diana Chan's attempt to build a clearing business for DTCC in Europe and is to buy LCH.Clearnet for €739 million. The announcement is here.
EuroCCP, DTCC's European subsidiary, had won business from Turquoise but in taking over one of the major European players, DTCC has instantly vaulted up the central counterparty league table in Europe. Interestingly, the existing LCH CEO, Roger Liddell whom I briefly worked with at Goldman, will be the CEO of the new combined European entity ["LCH.Clearnet HoldCo"].
Roger was made Head of Global Operations at Goldman Sachs in 2000. He was responsible for all businesses including equities, fixed income, foreign exchange, derivatives, commodities, asset management, prime brokerage and private wealth management. He is already very well known to DTCC as a consequence.
Where this leaves Diana Chan and her experienced COO, Trevor Spanner, is presently unclear.
I suspect that the combined entity in Europe will simply adopt LCH's systems, requiring Turquoise to migrate platforms. The larger question is to what extent DTCC will embark on the ambitious project to integrate the European infrastructure with the domestic US infrastructure.