NEW YORK—Nasdaq OMX Group Inc. and IntercontinentalExchange Inc. would close at least one U.S. data center if their unsolicited offer for NYSE Euronext is successful, a deal that Nasdaq has promised would create lower costs.
Nasdaq Chief Executive Robert Greifeld said Friday that the exchanges haven't yet decided which data center would be closed if the proposed deal is completed. On Friday, Nasdaq and ICE announced their joint bid for NYSE, valued at around $11.3 billion, topping the value of NYSE Euronext's planned merger with Deutsche Börse AG.
"It would certainly involve closing a data center," Mr. Greifeld said in a call with reporters. But without further research, "it's impossible to know which one would be the right candidate at this point," he said.
Industry experts said a merger of the exchanges would likely choose to keep open NYSE's data center in Mahwah, N.J., that opened last August.
"That's brand new and a considerable investment by NYSE," said Frank Piasecki, president of Activ Financial Systems, Inc., a market-data and trading-technology provider. "I can't imagine them walking away from that."
NYSE Euronext built the Mahwah facility as part of a $500 million project that also includes a sister facility in Basildon, Essex, in the U.K. Nasdaq operates two data centers: one in Carteret, N.J., and one in Ashburn, Va.
In an email sent to clients Friday morning, Nasdaq said its proposed deal would mean cheaper data and technology costs for its clients. "For existing products, we will both lower the direct and indirect costs of using our content, decreasing your spend on technology, network connectivity and programming," Randall Hopkins, senior vice president of Nasdaq's global data products, wrote in the email.
Having fewer data centers could lower costs for firms that have to invest significant funds in keeping expensive equipment as close as possible to all four stock exchanges and other major trading venues. Traders will still want to connect to exchange operators Direct Edge and BATS Global Markets, which run out of different data centers.
That will ensure that third-party companies that operate independent data centers, like Savvis Inc. and Equinix Inc., still play a role in connecting traders to market data.