Robert Greifeld, chief executive of Nasdaq, on Tuesday denied a report that he approached the New York Stock Exchange about a merger.
Speaking on CNBC, Greifeld said an article in The Wall Street Journal alleging that the Nasdaq executive spoke with NYSE officials three weeks ago about a possible marriage between the two marketplaces was “absolutely not true.”
Though Greifeld would not rule out the possibility that the two would ever combine while he is chief executive, he said Nasdaq remains committed to its electronically based trading model. He also took a jab at the NYSE, hinting it is outdated.
“It makes for a compelling argument about potential, but I hear a lot of chatter in our space,” Greifeld said. “I think that comes about because people realize that the market structure designed 200 years ago has to evolve.”
An NYSE spokesman declined to comment on the Journal story or Greifeld’s comments. The Journal issued a statement that it stood by its story.
Marrying the NYSE and Nasdaq would mean mixing two very different cultures.
“These are two virulently independent institutions,” said Jeffrey Sonnenfeld, associate dean at the Yale School of Management: “Why would the Nasdaq be interested in combining with an 18th Century anachronism like the NYSE? And conversely, it’s hard to imagine the NYSE migrating to the Nasdaq model.”
Speculation that the Nasdaq stock market would merge with a rival is not surprising, given the shifting landscape of the financial marketplace. Increased competition and the appearance of lower-cost rivals has prompted some to consider alliances and other moves that a few years ago would have been unthinkable.
On the Nasdaq all shares are traded electronically, while at the NYSE the trading floor is dominated by specialists. Both have had their share of recent problems: Last month, the Nasdaq swung to a third-quarter loss as revenue slumped 27 percent and costs rose, while the NYSE has been rocked by an investigation into its trading practices.
Other exchanges often mentioned as possible merger candidates include the Chicago Mercantile Exchange and the Chicago Board of Trade. Such a partnership would create the largest futures exchange in the world.
More Top Picks Bose Soundtouch 20
Merger talk is not limited to Chicago and New York. When the Philadelphia Stock Exchange’s membership voted to become a publicly traded company recently, one of the reasons given was that it was a necessary step toward attracting possible merger candidates.
Both the Chicago exchanges, longtime rivals, have begun working more closely than ever before, a relationship driven by the shared threat of Eurex US.
The German-Swiss-owned Eurex, the world’s largest futures exchange, hopes to open Eurex US next year. That all-electronic exchange has promised low per-trade prices, prompting the Board of Trade and the Merc to introduce new pricing plans.