Thursday the potential sale of the Chicago Stock Exchange to a Chinese group of investors was blocked. Regulators said that a lack of information of the potential buyers would hamper the regulators to properly monitor the exchange.
Exchange commission staff initially approved the sale of the privately owned exchange but the approval was put on hold for further review. Jay Clayton, a Trump appointee was a main factor of the decision. During the Trump’s campaign, he referenced the Chicago exchange on two occasions citing that it was an example of how jobs and wealth are leaving the US. One could surmise that this action to block the sale was steered by the Trump administration. The commission conducted an investigation regarding the potential owners. The buyers were not able to provide key information the commission requested and they were not willing to provide access to the owner’s books.
Lawmakers on both side of the aisle criticized the sale on the grounds that it would provide the Chinese government with access to the American financial markets. Also they had concerns over the ability of the commission’s ability to regulate and monitor the exchange with foreign owners.
The potential buyers were led by Chongging Casin Enterprise Group. The offered about $25 million in 2016. The group is a privately held company that invests in real estate development and financial holdings. They deny any affiliation with the Chinese government. The Casin group had long term plans of listing Chinese companies in the US and it had plans of building an exchange in China based on Chicago exchange’s technology.