London Calling? ICE’s Sprecher eyes options

Wed Mar 2, 2016 12:15am EST
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By John McCrank

NEW YORK (Reuters) - Jeffrey Sprecher has defined his career by buying up rivals of Intercontinental Exchange Inc, the company he founded as an upstart in 2000. Now he is at it again.

This week, ICE said it was eyeing a bid for LSE-Group, potentially thwarting an offer for the London Stock Exchange owner by Germany-based Deutsche Boerse. The move would be one of a string of blockbuster deals for ICE, including a $8.2 billion acquisition of the bastion of American capitalism - the New York Stock Exchange - in 2012. ICE had gone public on the NYSE in 2005.

"He's been a visionary in the exchange world and a consummate deal maker," said Rich Repetto, an analyst at Sandler O'Neill.

Sprecher, a Wisconsin-born chemical engineer by training, founded ICE in 2000 in Atlanta, Georgia, with the goal of modernizing energy trading through technology.

The former president of Atlanta's Continental Power Exchange persuaded seven big banks and energy firms including Goldman Sachs (GS.N: Quote), Morgan Stanley (MS.N: Quote), BP (BP.L: Quote) and Royal Dutch Shell (RDSa.L: Quote) to back him in a challenge to energy giant Enron's stranglehold on the electricity market.

When Enron collapsed in 2001, ICE was deluged with orders. That same year, Sprecher led a takeover of London's International Petroleum Exchange, giving ICE a European foothold in the futures market where it would grow into a dominant force. Sprecher, now 61, and his small team of top managers chose technology over tradition and as they pushed onward, showed little deference to tradition as they closed down historic trading pits.

In 2007, ICE bought the New York Board of Trade and attempted to buy the No. 2 U.S. futures exchanges, CBOT Holdings, for $9.9 billion - nearly disrupting a bid by the top futures market, CME Group - which had to counter its offer. The move attracted a lot of attention, especially with ICE executives slipping copies of the offer letter under the hotel doors of Charlie Carey, CBOT's chairman, and Bernie Dan, its CEO, at an industry conference in Boca Raton. Whether Sprecher tables a bid for the LSE or not, the acknowledgement that he is considering it pushed LSE’s shares to a record high on Tuesday, potentially raising the stakes for Deutsche Boerse, which is talking to the LSE about an all-share merger.

ICE declined to comment.   Continued...

Jeffrey Sprecher, founder and chief executive officer of IntercontinentalExchange (ICE), speaks at the Sandler O'Neill + Partners, L.P. Global Exchange and Brokerage Conference in New York in this June 7, 2013 file photo.   REUTERS/Brendan McDermid