The New York Stock Exchange is skating on thin ICE — new owner IntercontinentalExchange plans hundreds of exchange layoffs to slash costs, and may sell some tech assets, Street execs familiar with the situation told The Post.
The setback is not a good sign for the future existence of the financial institution, which traces its roots to a 1792 agreement under a buttonwood tree.
The pink slips affect the six-figure jobs of high-tech programmers, and those of other staffers. But the bloodletting could go much deeper — and force the sale of the NYSE itself, Street execs say.
A lot of people on the NYSE trading floor are not really comfortable,” said former Big Board floor trader Joe Cangemi.
Although he’s not personally aware of any asset-sale chatter, he has heard other unsettling talk. “Frankly, based on my experience and on what I am hearing, the whole floor is nervous,” said Cangemi, who is now CEO of ConvergEx Limited in London.
The tech asset sales are a strategic component of the efforts of ICE to squeeze out $500 million in savings. The owners will also wring costs from big job cuts.
Total expected cuts (1,500 worldwide) would reduce payroll to about 2,600, ICE execs have previously confirmed. NYSE’s head count at the time of the deal hovered around 4,000, with contractors factored in. That’s compared with the Atlanta-based ICE ’s much leaner 1,000 or so.
On a good day, the NYSE floor has about 700 traders overall, including options pros. However, stock traders, the mart’s traditional backbone, number just 300 as the troubled NYSE loses market share.
So far, one source who viewed the deal book assembled by ICE banker Evercore Partners says ICE is not impressed by prospective bids for the tech assets. The bidders include several major banks and brokerages and, most recently, media and information giant Thomson Reuters.
One Street pro told The Post that the bidding process was originally set to end a couple of weeks back. But it got extended, often a red flag it’s not going well.
Now, this same pro says, ICE is swinging the ax early “to sweeten the deal.” The pink slips are out for NYSE tech staff at its Wombat business in New York and a Wombat affiliate in Ireland where some 130 people are employed. Total layoffs in this area alone could involve “several hundred” employees, sources say.
ICE, headed by strong-willed Jeffrey Sprecher, has a history of shuttering floor operations that don’t deliver to the bottom line.
It closed the floors and moved to electronic trading after acquiring the International Petroleum Exchange in 2001 and the New York Board of Trade in 2007.
“Nobody really knows,” said Cangemi. “They’ve promised not to close the NYSE floor, but that does not mean a thing. There is no commitment to it.”
“If Sprecher can make the NYSE simpler, better and easier, he’ll keep it,” said NYSE and ICE investor Thomas Caldwell, CEO of Caldwell Securities. “And if he can’t … well, I think he is going to dump it.”
“We don’t have any comment at this time,” said Eric Ryan, a spokesman for ICE and NYSE Euronext. Evercore Partners also declined to comment.