NEO Exchange Goes Global After Cboe Acquisition

A new acquisition has brought the Canadian stock market closer to the global stage.

The Toronto-based NEO Exchange was acquired by Cboe Global Markets (BATS:CBOE) in June, bringing the emerging securities exchange to a wider array of investors.

The market infrastructure and tradable products provider completed the deal for an undisclosed amount using “existing credit facilities and cash on hand.”

NEO finds a dancing partner

The NEO has earned a reputation as an alternative securities exchange in Canada offering space for novel investment vehicles and companies in new and upcoming markets such as cannabis and blockchain.

“With NEO, we are creating another connection across borders through our network of trusted markets, enabling Canadian clients to pursue global growth opportunities through innovation, enhanced technology and access to new ways of trading and listing,” Ed Tilly, chairman and CEO of Cboe Global Markets, said.

The deal was originally announced in November of last year.

NEO exec shares vision for the future

The Investing News Network (INN) sat down with Jos Schmitt, co-founder, CEO and president of the NEO Exchange, to discuss the impact of this acquisition and what the next steps for the Canadian exchange will be.

“(Cboe Global Markets is) an extremely large market infrastructure provider across a multitude of business lines and with the largest footprint that any of their competitors assess,” Schmitt told INN.

The executive said that after operating for over five years, the NEO has increased its aspirations, making the acquisition a logical choice.

“We realized that we could do that on the back of our own free cash flow,” Schmitt explained. “But if we wanted to do that in an accelerated way, we needed to look at other ways of injecting capital in (our) organization.”

Schmitt said that at one point the NEO considered going public as part of its growth plans, but instead it elected to pursue a relationship with Cboe Global Markets.

The NEO co-founder will now become the lead for Cboe Global Markets’ global listings strategy. “The objective there is to come up with a global offering leveraging the great foundation that they’ve already established in the exchange traded product space,” he explained to INN.

In closing, Scmitt emphasized his passion for the Canadian markets, pointing in particular to the cleantech, fintech, biotech, crypto and carbon sectors as industries to watch.

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Securities Disclosure: I, Bryan Mc Govern, hold no direct investment interest in any company mentioned in this article.

Editorial Disclosure: The Investing News Network does not guarantee the accuracy or thoroughness of the information reported in the interviews it conducts. The opinions expressed in these interviews do not reflect the opinions of the Investing News Network and do not constitute investment advice. All readers are encouraged to perform their own due diligence.

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