Nasdaq Inc. in talks with Texas Gov. Abbott about relocating trading systems to D-FW, sources say

Nasdaq Inc. is in talks with Texas Gov. Greg Abbott about potentially relocating the exchange’s electronic trading systems from New Jersey to Dallas-Fort Worth, according to two sources familiar with the discussions.

Other trading exchanges also could be involved in the discussions, both sources said.

Nasdaq is planning a visit to Texas to meet with the governor, according to one of the sources. Leaders of the exchange have had “a great dialogue” with Abbott, the source said.

The exchange, which has 87 employees in the state, is intrigued by an opportunity touted by Abbott to power its electronic infrastructure with renewable energy from wind farms in the state, according to one of the sources. Nasdaq is the trading platform for many of the nation’s environmentally conscious companies.

When Facebook invested $1 billion in building its massive data center at AllianceTexas north of Fort Worth, it struck a deal to buy its electricity from a 17,000-acre wind farm under construction at the time. Facebook, which trades on Nasdaq, is now planning to add to its 150-acre campus, which opened in 2017.

Dallas-Fort Worth isn’t alone in wooing the stock exchanges. Officials in Virginia, North Carolina and Illinois have also had discussions with Nasdaq, one of the sources said.

In a statement to The Dallas Morning News, Nasdaq vice president of communications Joe Christinat said: “We are assessing all options, but our No. 1 priority is protecting the U.S. capital markets and its investors.”

A spokesman for the New York Stock Exchange’s parent company, the Intercontinental Exchange, couldn’t be immediately reached for comment.

A potential tax on financial transactions in New Jersey, where Nasdaq and other exchanges house the data systems that power Wall Street’s daily trades, is what’s driving the talks.

NYSE, Nasdaq and Cboe Global Markets Inc. signaled in September that they would be willing to shift operations away from New Jersey if the state passed the proposed tax. The proposal would implement a quarter-cent tax on every transaction for firms handling more than 100,000 transactions a year.

New Jersey Gov. Phil Murphy has said as recently as this week that he supports the tax. New Jersey faces a $5.63 billion shortfall in its current fiscal year as a result of a drop-off in tax revenue during the coronavirus shutdown.

On Tuesday, a coalition of trade associations representing about 200,000 financial services workers sent a letter to New Jersey lawmaker John F. McKeon, the proposal’s sponsor, conveying “strong opposition” to the tax.

“A [tax] could lead to financial firms moving their electronic infrastructure and the related jobs outside of New Jersey. This would reduce employment and revenue in the state,” the coalition wrote.

Last month, NYSE conducted a dry run using a backup system in Chicago to determine how quickly it could move operations out of New Jersey. Nasdaq has performed similar tests.

Dallas-Fort Worth is one of the nation’s largest data center markets, with tech giants like Facebook and Google investing heavily in new facilities in recent years.

Facebook recently filed plans with the state to expand its massive AllianceTexas facility by an additional 277,000 square feet. Google is constructing a 375-acre, $600 million data center campus in Midlothian in Ellis County.

Source Article