London, Toronto stock exchanges announce merger
Financial professionals trade on the floor of the New York Stock Exchange, November 3, 2010 in New York.
TEXT OF STORY
ADRIENE HILL: Two stock exchanges -- one in London and the other in Toronto -- have announced this morning they plan to merge. If regulators okay the deal, it'll create one of the largest exchanges for mining and commodity stocks.
For more we go to reporter Christopher Werth in London. Good morning Christopher.
CHRISTOPHER WERTH: Good morning.
HILL: So how big of a deal is this for American investors and the rest of the world?
WERTH: Well, if you look at the numbers, the London stock exchange is worth about $4 billion. The Toronto exchange about $3 billion. This merger could increase the pool of money that's out there chasing after these Canadian mining stocks by bringing in more British and European investors. And this is also part of a trend. Big mergers across the board in a number of industries, including stock exchanges. The Singapore exchange recently announced plans to merge with the Australian market. The London and Toronto exchanges say this deal will create savings for them of $56 million.
HILL: So that's big money. How does this actually work though?
WERTH: Well, even though we still tend to think of a bunch of traders, you know, frantically gesturing in a pit --
HILL: With their really cool jackets?
WERTH: Yeah, exactly. I mean that's not what this merger deals with. I spoke with Andrew Hilton at the CSFI think tank here in London.
ANDREW HILTON: The days of open outcry are over. There aren't going to be thousands of people in London speaking with Canadian accents and stripy jackets. It isn't going to be done that way.
So you know, these exchanges are done electronically these days.If you were to walk by the London Stock Exchange building here you'd hardly know that such large volumes were being traded inside.
HILL: Alright Christopher Werth in London. Thanks Christopher.