The London Stock Exchange has sold its Sets order-driven trading system to the JSE Securities Exchange South Africa in a deal worth a minimum of £11 million in additional revenue for the LSE over the next five years.
The deal specifies the provision of core technology services by the LSE to the JSE and aims to achieve easier access to each other's markets for both member firms and issuers. The two exchanges say they are exploring ways of simplifying the means by which UK and South African issuers access the respective London and Johannesburg markets.
The JSE says it expects to boost revenue potential from data distribution once the new platform is installed by year-end. The tie-up with the LSE enables the South African exchange to extend its reach and the services it can offer to local brokers and investors while at the same time retaining its independence and control over the operation of its market.
Russell Loubser, chief executive, says the JSE will use the Sets platform to realise its vision of becoming the gateway to financial services for the sub-continent. "We will also be able to offer the Namibian exchange the opportunity to join us in using the London Stock Exchange's technology in unlocking the potential in the SADC region," he adds.
For the LSE, the deal represents a diversification into a new business: as a technology supplier to exchanges worldwide. The Sets order-driven platform is operated for the LSE by Accenture, the management consultancy, which advised both exchanges on the transaction.