Bats in bid talks amid sector shake-up

Chi-X Europe and US exchange Bats Global Markets, which owns Bats Europe, said they had "entered exclusive negotiations regarding the sale of Chi-X Europe".

They did not provide any detail such as on price.

The deal would create one of the largest European share trading firms, with a combined market share of about 22 per cent, putting it on par with the London Stock Exchange (which has about 23 per cent across its various units.

While a raft of upstart trading platforms has rapidly won market share from incumbent stock exchanges since the European Union introduced MiFID laws to enhance competition in 2007, they have struggled to make money.

European equity trading levels have been lower than expected since the financial crisis and the largest brokerage firms have been saying for a year that the new sector – which offers lower fees and faster trading – was set for a shake-out.

The LSE this year bought an alternative trading platform called Turquoise, while Nasdaq closed its pan-European trading platform Neuro in April citing the "increasingly competitive nature" of the business.

Separately, the EU is planning an overhaul of the MiFID rules that could further unsettle an already rapidly changing sector and offer European stock exchanges a lifeline as the focus shifts towards stability after the financial crisis.