Proposed Acquisition by Nasdaq Technology AB of Cinnober Financial Technology AB


CCCS 400/010/18

Notifying Parties:

Nasdaq Technology AB

Cinnober Financial Technology AB

Notifying Date:

15 October 2018

Summary of transaction:

(i) the names of the merger parties;

  1. Nasdaq Technology AB (“Nasdaq”)
  2. Cinnober Financial Technology AB (“CINN”) (collectively the "Parties")

(ii) a description of the transaction;

Acquisition of 100% of the issued shares in CINN by Nasdaq Technology AB, which will result in Nasdaq and CINN ceasing to be distinct.

(iii) a description of the business activities of the merger parties worldwide and in Singapore;

Nasdaq Technology AB’s parent company, Nasdaq Inc., and CINN, supply information technology (“IT”) services for market technology solutions, including trading, clearing, risk management and market surveillance software, to financial institutions, clearinghouses and exchanges. Although the same products are used regardless of the commodity, these can be broken up into cash equities, derivatives (futures and options), fixed income, commodities, foreign exchange and digital currencies. Both companies supply market technology solutions and other services to support trading and post-trade services to banks, brokers and marketplaces, to facilitate the trading of a full range of financial instruments. 

(iv) a description of the overlapping goods or services, including brand names;

The overlapping products are defined as information technology services for market technology solutions, including trading, clearing, risk management and market surveillance software.

The following brand names are used by the Parties in Singapore:

  • Nasdaq: NFF (trading and clearing) and SMARTS (market surveillance); and
  • Cinnober: Real Time Clearing (clearing) and TradeXpress (trading). 

(v) a description of substitute goods or services;

On the demand-side, there is no substitutability between the different segments of market technology solutions identified above. A customer requiring a trading solution would not switch to a clearing or surveillance solution and vice versa.

On the supply side, there is substitutability with regard to the provision of market technology solutions. This is due in large part because the underlying IT operating systems applicable to trading, clearing, surveillance and risk management software is the same. This provides the basis for a supplier in one segment to develop and market products for another segment or, as is the case for CINN with respect to surveillance products, to add a niche third party supplier’s solution to the supplier’s overall offering. Many suppliers seek to offer a full suite of exchange trading solutions, which add to their underlying platform / Application Programming Interface.

(vi) the applicant’s views on:

  1. definition of the relevant market(s);

    The relevant market is the global market for the supply of information technology services for market technology solutions, including trading, clearing, risk management and market surveillance software.

    The geographic market is global, as there are no restraints preventing competing suppliers from serving customers anywhere in the world. In fact, the Parties provide software and services to clients all around the world, despite having no physical presence where many of their customers are located.

  2. the way in which competition functions in this market;

    The market can be characterised as highly competitive, given technology suppliers anywhere in the world can serve any customer, including Singaporean customers. There are a number of participants that compete for bids in the relevant market, in addition to a number of dynamic and disruptive new market entrants. The competitive landscape in the relevant market will continue to change, due to the advent of new disruptive technologies, which in turn create an environment conducive to new market entrants.

  3. barriers to entry and countervailing buyer power; and

    Entry costs will vary depending on how and where the platform is being developed, and therefore costs are difficult to estimate. However, with the advent of new technology such as cloud deployment, distributed ledger technology and opensource, entry costs are noticeably reducing. These technologies disrupt the traditional approach to deploying technology at exchanges, clearinghouses and regulators.

  4. the competitive effects of the merger (non-coordinated, coordinated and/or vertical effects, as relevant).

The Transaction will not have any anti-competitive effects, because:

  1. Co-ordinated effects will not arise as a result of the merger;
  2. There are numerous competitors. The concentration of competitors in the global market for market technology solutions is very low, and there are a large number of credible competitors (for example, LSEG, Deutsche Borse, Euronext and TMX) who are capable of constraining the Combined Organisation.
  3. Although there are some barriers to entry, these are not insurmountable and are decreasing with the advent of new technologies in the market for market technology solutions, which means that the products can now be offered remotely. That is, a physical presence in Singapore is no longer required;
  4. Customers are typically large and sophisticated banks, brokers, other financial institutions, clearinghouses and exchanges, and are capable of exercising significant countervailing buyer power, including by switching suppliers;
  5. Customers have the ability (and in fact, many do) self-supply; and
  6. There are no vertical relationships between the Parties, nor are there any existing supply arrangements between the Parties. Each party produces and supplies its own software and supplies these products directly to financial institutions and exchanges.


The proposed merger, if carried into effect, will not infringe the Section 54 prohibition.

Decision Date:

27 November 2018.

Read Media Release.

Read the Grounds of Decision.