TORONTO and MONTREAL, Nov. 4 /CNW Telbec/ - TMX Group Inc. (TSX:X) today announced an important phase in its integration plan that was established to achieve the benefits from the combination of TSX Group and Montreal Exchange (MX), which was completed on May 1 this year.
"Our plan includes the investment in new business and product initiatives to better serve our customers' needs, particularly in the derivatives sector, while at the same time, achieving cost synergies by realizing efficiencies in data centre operations and corporate support functions" said Tom Kloet, CEO, TMX Group. "While it is unfortunate that we cannot retain all of our employees in the combined organization, I am confident that we have developed the best structure to ensure the success of TMX Group going forward" added Mr. Kloet.
TMX Group plans to grow its business by adding new products such as a futures contract based on a Canadian volatility index and mini-sized equity index futures contracts. In addition, plans call for the expansion of clearing of over-the-counter derivatives and further development of its SOLA(R) technology platform, which supports both the Montreal Exchange and Boston Options Exchange (BOX). These initiatives are anticipated to eventually generate more than $10 million annually in new revenue(1) and will require TMX Group to enhance its pool of expertise by adding approximately 30 highly skilled, value-added jobs in clearing, technology application development and product and services development at the MX office in Montreal.
As part of the plan, TMX Group's offices and data centers will be consolidated and the company will eliminate 85 corporate support and operational positions, or approximately 10% of its workforce, over a period of 14 months. The rationalization of data centres will enable customers to consolidate their connectivity networks and co-locate at one location which will greatly reduce their technology and communication expenditures.
"In the current financial context, we see great opportunities to create efficiencies for our customers while further developing the risk management portion of our business, which is a key component of the Montreal Exchange." noted Luc Bertrand, deputy CEO, TMX Group and President and CEO of the Montreal Exchange. "Montreal will continue to be the centre of expertise for derivatives, maintaining positions that are based on know-how and innovation, to service its range of new and existing products," he added.
Forward Looking Information
This press release contains "forward looking information" (as defined in applicable Canadian securities legislation) that is based on expectations, estimates and projections as of the date of this press release. Examples of such forward looking information in this press release include, but are not limited to factors relating to the business, financial position, operations and prospects of TMX Group, which are subject to significant risks and uncertainties. Forward looking information involves known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of TMX Group to be materially different from any future results, performance or achievements expressed or implied by the forward looking information in this press release. Please refer to the risk factors discussed in TMX Group's materials, including our 2007 Annual Management's Discussion and Analysis (MD&A) and our Q3/08 interim MD&A.
We have no intention to update this forward looking information, except as required by applicable securities law. This forward looking information should not be relied upon as representing our views as of any date subsequent to the date of this press release.
About TMX Group (TSX-X)
TMX Group's key subsidiaries operate cash and derivative markets for multiple asset classes including equities, fixed income and energy. Toronto Stock Exchange, TSX Venture Exchange, Montreal Exchange, Natural Gas Exchange, Boston Options Exchange (BOX), Shorcan, Equicom and other TMX Group companies provide trading markets, clearing facilities, data products and other services to the global financial community. TMX Group is headquartered in Toronto with offices in Montreal, Calgary and Vancouver. For more information about TMX Group, visit our website at www.tsx.com
(1) The $10 million represents management's estimate of the potential
revenue opportunity based on similar products in Canadian and global
markets. Actual results could differ materially from the estimates and
could result in minimal revenue depending on customer acceptance, market
conditions and competitive factors. Please refer to Forward Looking