Exclusive: ICE talking to former LME chief about new metals platform
(Story refiles to insert dropped letter in first paragraph of Tuesday report)
By Pratima Desai and Clara Denina
LONDON (Reuters) - Intercontinental Exchange (ICE) (ICE.N: Quote) is looking into setting up a London-based metals trading system, industry sources familiar with the matter said, more than four years after its failed attempt to buy the London Metal Exchange.
The sources said New York-listed ICE is talking to Martin Abbott, a former chief executive of the 140-year-old LME, the world's largest and oldest market for trading metals.
Abbott, who headed the exchange from 2006-2013, held talks with trading houses and brokers last year about launching a new trading platform for metals in a direct challenge to the LME, a move prompted by discontent over rising trading fees.
Nothing came of the talks but the idea has not gone away, with ICE, which offers New York-based futures trading, showing interest.
"ICE is looking at the possibility of expanding into metals (in London)," one senior broking source said. "We'll look at it if it develops further. Any loyalty we had (to the LME) went a long time ago when they raised fees at a very difficult time for us."
ICE declined to comment, while a spokesman for Abbott said: "As of today I can say that while there has been some informal contact with ICE, absolutely no formal conversations have taken place or are scheduled."
Sources say any new platform would have to cater for industrial users such as consumers and producers who often want physical delivery of metals, requiring a global network of warehouses such as those registered with the LME. Continued...