Although a string of “unforeseen and unavoidable” events have delayed the establishment of Gibraltar’s stock exchange — which was expected to be up and running by the fourth quarter of this year — the £4-million GibEX project has taken on a new urgency with
the recent appointment of one of Europe’s most experienced stock exchange professionals as its CEO. Negotiations with the European bourse which is to partner GibEx are also at an advanced stage, and the dual-platform exchange is now expected to be fully operative early
next summer.   

Sauer, who is credited with revamping the Swiss Stock Exchange and bringing a massive improvement to its fortunes, will be joined by the equally experienced Nick Cheronai as the chief operations officer.   

“We have reached agreement, the documents have been finalised, and the board of GibEx has also given it the green light,” Daniel Feetham, who has played a major part in the negotiations, explains. “All we are waiting for is the final go-ahead from the board of the other exchange whose identity is being kept secret until this is obtained.”
At the same time it has emerged that in December last year three major players involved in the development of GibEx joined an International Advisory Board to help develop and present to the Ukrainian Government a ‘White Paper’ on a development strategy
for the Ukrainian Stock Market, prompting speculation that, as well as taking a European partner for its operations, GibEx also could establish loose but profitable links with the bourse in what was a member of the old Iron Curtain block.   

The Ukrainian advisory board will be chaired by Sonja Kohn, chairman of Bank Medici in Austria who, along with Levy was one of the initiators of the GibEx proposals. She was an advisor to the Vienna Stock Exchange and arranged the links between the
Shanghai Stock Exchange and Dubai Financial Market. As well as Mrs Kohn, two of the other international experts involved in preparing a development strategy for the Ukranian Stock Market have close links with GibEx. They are Sauer and Richard van den Drijver,
Chairman and CEO of Van der Moolen — the fourth largest market maker on the New York Stock Exchange, a founding partner and shareholder of the Chicago Stock Exchange, and a major shareholder of Gibraltar’s GibEx.   

The delay in establishing the new exchange — its specially designed home in a new city-centre building was completed early this summer — was a last-minute switch from its intended partner Deutscheborse when the German exchange decided that it wanted to bring in Xtra as well, creating two different platforms — one for cash products and the other for derivatives. The change of a bourse partnership has not affected the decision by one of Europe’s biggest financial holding companies to invest in and become a partner of the local
exchange. The multi-billion euro Dutch firm, Moolen Holdings, will be an active partner in running GibEX.   

“The participation of the Van der Moolen Group means we are definitely on track for the exchange to open next year,” I was told. “The group’s recent move into partnership in the new Chicago exchange — which is expected soon to rival the New York Stock Exchange
on Wall Street — will provide synergies which Gibraltar can tap into and is also likely to swell the amount of business to come in GibEX’s direction.”   

An international trading group active in equities, bonds and related instruments (such as optionsand futures) VDM, as the group is known, is listed on both Euronext (where it handles about one fifth of all shares traded) and on the NYSE (where it handles almost 11
per cent of the volume of all stocks dealt, VDM are the fourth largest specialist liquidity provider on the NYSE, and plans to launch similar services on U.S. exchanges as well
as in Gibraltar.   

In Europe VDM are one of the top three derivatives specialists on Euronext, and act as on-exchange market-makers in fixed income instruments as well as being proprietary
traders in Euronext equities. The group also offers professional customers an electronic and voice brokerage on a growing number of exchanges through Online Trader, which was launched last year. Earlier this year it announced that it would join the Chicago Board Options Exchange — the biggest US market for options on stocks and stock indices — and two other New York Stock Exchange specialist firms to establish an exchange to trade equity securities next year.   

Van der Moolen Holding will have an 18 percent stake in the new market.   

The proposed CBOE Stock Exchange will feature the same combination of screen and floor-based trading that propelled its parent company to the top of the American stock-options markets. The exchange will seek to trade securities listed on the New York Stock
Exchange, NASDAQ Stock Market and American Stock Exchange. Fees of the new exchange will be “highly competitive” compared with other markets because the CBOE doesn’t need to invest in new technology to run the exchange. A similar, though smaller, system is likely to be introduced by GibEX.   

by Peter Schirmer