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CNBC Exclusive: CNBC Transcript: IntercontinentalExchange CEO Jeffrey Sprecher Speaks with Maria Bartiromo Today on CNBC

When: Today, Monday, January 14, 2013

Where: CNBC's "Closing Bell"

Following is the unofficial transcript of a CNBC EXCLUSIVE interview with IntercontinentalExchange CEO Jeffrey Sprecher today, Monday, January 14 on CNBC's "Closing Bell." Additionally, here is a link to embeddable video of the interview: http://video.cnbc.com/gallery/?video=3000139786.

All references must be sourced to CNBC.

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MARIA BARTIROMO: WELCOME BACK IT WAS THE DEAL THAT SENT SHOCKWAVES THROUGHOUT THE EXCHANGES, THE INTERCONTINENTALEXCHANGE OR ICE ANNOUNCING THAT IT WOULD ACQUIRE NYSE EURONEXT FOR 8.2 BILLION DOLLARS. NOW SINCE ICE IS AN ELECTRONIC EXCHANGE MANY ON THIS FLOOR ARE ASKING WHAT THIS SALES MEANS TO THEM AND TO FLOOR TRADING OVERALL. JOINING ME RIGHT NOW EXCLUSIVELY INTERCONTINENTALEXCHANGE'S MAN IN CHARGE, CEO JEFF SPRECHER. JEFF GOOD TO HAVE YOU ON THE PROGRAM

JEFFREY SPRECHER: THANK YOU, MARIA

BARTIROMO: GOOD TO SEE YOU. FIRST, BEFORE WE GET INTO THE CHANGES THAT YOU'RE GOING TO MAKE, WHAT'S THE OPPORTUNITY? WHY ARE YOU LOOKING TO ACQUIRE NYSE EURONEXT?

SPRECHER: WELL NYSE HAS BUILT A VERY BIG FINANCIAL EXCHANGE AND MY COLLEAGUES AND I HAVE BUILT A VERY BIG COMMODITY AND COMMODITY DERIVATIVES EXCHANGE. SO PUTTING THE TWO TOGETHER REALLY MAKES A COMPLETE PACKAGE. WE THINK USING OUR COMBINED NETWORK THAT WE CAN OFFER THE GLOBAL CLIENTS A BIGGER PORTFOLIO OF THINGS TO TRADE.

BARITROMO: I'M REALLY GLAD YOU SAID THAT BECAUSE I WAS LOOKING AT THE DIFFERENCES IN THE EXCHANGES AND YOUR BRAND IS LARGELY COMMODITIES. YOU'VE GOT OBVIOUSLY COFFEE, SUGAR, COCOA. YOU'VE GOT ALL THE COMMODITIES THAT EVERYBODY TRADES IN AN ACTIVE BUSINESS. AND THE EXCHANGE IS CASH, IT'S LIFE, IT'S DERIVATIVES. WHERE ARE THE REVENUE SYNERGIES? DO YOU HAVE REVENUE SYNERGIES OR IS IT JUST SORT OF OPERATING SYNERGIES WHERE YOU CAN CUT?

SPRECHER: WELL, WE JUSTIFIED THE DEAL TO THE CAPITAL MARKETS BY TALKING ABOUT HOW WE CAN COMBINE AND TAKE COSTS OUT OF THE BUSINESS. BUT THE REALITY IS, THE REASON DUNCAN AND I DECIDED TO GET TOGETHER, WAS WE BELIEVE WE CAN GROW THE TOP LINE OF THIS COMPANY. YOU HAVE A TREND GOING ON IN THE WORLD NOW WHERE MORE AND MORE OVER THE COUNTER MARKETS AND UNLISTED BUSINESSES ARE COMING TO THE EXCHANGES DUE TO DODD-FRANK AND THAT SIMILAR KIND OF LEGISLATION GOING THROUGH EUROPE AND ASIA. AND WE WANT TO POSITION OURSELVES IN THE FINANCIAL AREA WHERE WE CAN BE THE BENEFICIARIES OF THAT MOVEMENT.

BARTIROMO: SO IN TERMS OF REVENUE SYNERGIES THAT'S THE POINT. YOU DON'T WANT TO HAVE A LOT OF OVERLAP OTHERWISE THE DEAL WOULDN'T BE PASSING MUSTER.

SPRECHER: ABSOLUTELY, THAT'S EXACTLY RIGHT. AND WE'VE SEEN IN OUR INDUSTRY PARTICULARLY AND NYSE EURONEXT SPECIFICALLY IT'S BEEN HARD TO PUT THESE MERGERS TOGETHER. IF YOU LOOK AT OUR TWO BUSINESSES AS WE SIT HERE TODAY, WE HAVE NO OVERLAP WHICH WE THINK WILL HELP MAKE IT EASY TO PUT THE BUSINESSES TOGETHER.

BARTIROMO: SO PUTTING THOSE BUSINESSES TOGETHER IN TERMS OF OPERATING AND IN TERMS OF WHERE THE OVERLAP IS. WHAT KIND OF COST CUTS CAN YOU MANAGE? WHAT DO YOU THINK THE OPPORTUNITY IS THERE?

SPRECHER: YEAH, WELL, FOR US WE'LL HAVE TWO NETWORKS THAT WE CAN GO DOWN TO ONE. WE'LL HAVE DATA CENTERS THAT WE CAN COMBINE-- AUDITORS, TWO BOARDS OF DIRECTORS. SO THERE'S A LOT OF JUST STUFF THAT'S INCUMBENT ON RUNNING AN EXCHANGE, PARTICULARLY PUBLIC EXCHANGES, THAT WE CAN TAKE OFF. SO THAT REALLY IS THE COST CUTTING THAT WILL HELP JUSTIFY THE DEAL. BUT THE REASON WE WANT TO DO THE DEAL IS TO POSITION OURSELVES FOR THE MOVEMENT OF MORE BUSINESS PARTICULARLY IN THE OTC COMMODITY AND DERIVATIVES AREA THAT WE THINK IS GOING TO COME INTO THE EXCHANGE LISTED VENUE.

BARTIROMO: AND THAT'S REALLY WHERE THE MONEY IS, THE DERIVATIVE BUSINESSES.

SPRECHER: WE HOPE SO.

BARTIROMO: THAT'S WHERE THE MARGIN IS. SO WHAT WOULD YOU DO WITH FOR EXAMPLE THE LISTING BUSINESS? ARE YOU EXPECTING THE LISTING BUSINESS AT SOME POINT TO BE SPUN OFF? SOLD?

SPRECHER: NO. IN FACT, AS WE STARTED LOOKING—WE AT ICE STARTED LOOKING AT THE NEW YORK STOCK EXCHANGE WHICH WAS A COMPANY WE KNEW BY REPUTATION, BUT NOT BY LOOKING UNDER THE COVERS, WE FOUND A GOOD BUSINESS HERE. THE LISTINGS BUSINESS IS DOING WELL, AND THE TRADING BUSINESS IS DOING WELL. BECAUSE OF ALL THE NEED FOR DATA AND TECHNICAL SERVICES THAT ARE NOW EMBODIED AROUND AN EXCHANGE. THERE'S A GOOD FRANCHISE IN HERE. THE OTHER INTERESTING THING I SAW, DUNCAN NIEDERAUER AND I HAPPEN TO BE NEGOTIATING THIS DEAL WHEN HURRICANE SANDY CAME THROUGH. AND WE WERE ON PHONE CALLS WITH THE INDUSTRY TRYING TO FIGURE OUT WHAT TO DO. AND THERE WERE HUNDREDS OF COMPANIES ON BIG CONFERENCE LINES. AND REALLY THE INDUSTRY TURNED TO DUNCAN AND SAID IS THE NEW YORK STOCK EXCHANGE GOING TO OPEN? AND IT WAS THAT DECISION THAT ALL OF WALL STREET PIVOTED ON. SO AS A SMALL BUSINESS ENTREPRENEUR, WHICH IS HOW I THINK OF MYSELF, I SAW THE POWER OF THIS BRAND IN A MOMENT OF CRISIS. AND I SAID WOW THAT'S SOMETHING YOU SHOULD OWN.

BARTIROMO: YOU'RE ABSOLUTELY RIGHT. I MEAN THAT MORNING OR THAT NIGHT WHEN WE LEARNED THAT THE EXCHANGE WOULD ACTUALLY CLOSE, I WAS SHOCKED. I SAID TO MYSELF THIS IS AN ELECTRONIC WORLD. I DON'T UNDERSTAND WHY WE HAVE TO CLOSE DOWN TRADING IN THE COUNTRY. SO WOULD YOU HAVE STAYED OPEN GIVEN THAT --

SPRECHER: YES. BUT WHAT WAS INTERESTING IS THAT IN THE EQUITIES BUSINESS, IT'S GOTTEN SO FRAGMENTED, IT'S SO COMPLICATED, ALL THE THINGS THAT LED TO THE FLASH CRASH AND THIS SPAGHETTI OF NETWORKS THAT HAVE HOOKED TOGETHER, THE MARKET WANTS HUMAN BEINGS. THE MARKET RELIES ON HUMAN BEINGS. IT WAS PEOPLE IN THIS BUILDING THAT SAW THE KNIGHT CAPITAL TRADING ENGINE RUN AWAY. THEY WERE THE ONES THAT SAW IT AND SAID HEY SOMETHING'S AMISS. THE MARKET REALIZES NOW THAT TECHNOLOGY ALONE ISN'T GOING TO SOLVE THE PROBLEMS. YOU'VE GOT TO HAVE THE HUMAN TOUCH. AND JUST NOT BEING ABLE TO HAVE THESE PEOPLE, THESE PROFESSIONALS ON THE DAY THAT HURRICANE SANDY WAS COMING THROUGH WAS ENOUGH TO ACTUALLY CLOSE ALL THE WALL STREET INCLUDING THE BOND MARKETS AND ULTIMATELY MY COMMODITY MARKETS. SO I THINK THERE'S MORE THAN SYMBOLISM THERE. AND THAT'S WHY I WAS INTERESTED.

BARTIROMO: THAT'S THE THING. IF WE'RE OPERATING IN AN ELECTRONIC WORLD YOU WOULD THINK BUSINESS CAN GO ON IF THE PEOPLE ON THE FLOOR MAYBE COULDN'T GET HERE OR BE HERE. WHAT ABOUT THE FLOOR? A LOT OF TRADERS WALKING AROUND TODAY, THEY KNOW ARE A GUEST ON THE SHOW THEY WANT TO KNOW ARE YOU GOING TO DO AWAY WITH THE FLOOR? WHAT ARE YOUR PLANS?

SPRECHER: THEY SEEM TO BE SMILING, BY THE WAY.

BARTIROMO: SO FAR SO GOOD.

SPRECHER: HOPEFULLY YOU'VE SAID GOOD THINGS TO THEM. YEAH, I MEAN, I THINK THAT FACT ALONE SAYS WE SHOULD EMBRACE THIS MODEL AND FIGURE OUT HOW TO EXPLOIT IT. IF WALL STREET WANTS HUMAN BEINGS INVOLVED IN THE TRADE THEN WE NEED TO FIGURE OUT HOW TO KEEP THEM INVOLVED. OBVIOUSLY THERE'S GOING TO BE MORE TECHNOLOGY, YOU CAN JUST LOOK BEHIND US HERE AND SEE THERE'S MORE AND MORE TECHNOLOGY COMING INTO THE EXCHANGE. YOU'VE GOT TO HAVE HUMANS INTERFACING WITH THAT TECHNOLOGY. WE'VE GONE TOO FAR WHEN COMPUTERS ARE TRADING WITH COMPUTERS AND THERE'S NOBODY WATCHING.

BARTROMO: BUT, I MEAN, WHEN YOU LOOK AT YOUR PAST DEALS, YOU COULD LOOK AT THE INTERNATIONAL PETROLEUM FLOOR IN LONDON. YOU CLOSED THAT. THE NEW YORK BOARD OF TRADE YOU ACQUIRED. YOU ELIMINATED THAT FLOOR. YOU EVEN CHANGED THE NAME. SHOULD WE EXPECT THIS EXCHANGE DOWN HERE IS GOING TO BE A LOT MORE ELECTRONIC THAN WE'VE EVER SEEN?

SPRECHER: YEAH. WHAT HAPPENED IN THOSE CIRCUMSTANCES, IS THAT I DIDN'T DO ANYTHING THE MARKET MOVED ALL THE VOLUME OFF THE FLOOR ONTO THE SCREEN.

BARTIROMO: YES. MY APOLOGIES. THIS IS NOT PERSONAL. THIS IS BUSINESS, YOU'RE GOING TO GO WHERE THE BUSINESS IS AND EVERYBODY KNOWS THAT.

SPRECHER: I DON'T TAKE IT PERSONALLY. BUT THAT DID NOT HAPPEN HERE. YEARS AGO ARCHIPELAGO AND NYSE MERGED, BECAME A MUCH MORE ELECTRONIC NYSE. BUT YET THE MARKET HAS KEPT THIS FLOOR HERE AND THERE IS A REASON. AND THAT IS THAT THE EQUITIES BUSINESS HAS GOTTEN TOO COMPLICATED. AND PEOPLE WANT HUMAN BEINGS INVOLVED. SO I SAY CELEBRATE IT. I'M AN ENTREPRENEUR AND I SAY THIS IS SOMETHING UNIQUE AND WE SHOULD CELEBRATE IT AND FIGURE OUT HOW TO EXPLOIT IT AND MAKE SURE THE PEOPLE SEND THEIR ORDERS HERE.

BARTIROMO: WHAT ABOUT THE NAME? THE OVERALL NAME OF THE FIRM IS WHAT?

SPRECHER: WELL, ICE IS THE ACQUIRER OF ALL THESE COMPANIES, BUT UNDERNEATH THAT WE HAVE MORE THAN A DOZEN EXCHANGES AND CLEARINGHOUSES THAT ALL HAVE THEIR OWN REGULATORS, THEIR OWN BOARDS, THEIR OWN BRANDS. AND WE'RE GOING TO KEEP ALL OF THOSE BRANDS BECAUSE THEY'RE STRONG BRANDS IN THE MARKETS THAT THEY SERVE. WHAT WE DO WITH THE HOLDING COMPANY IS ACTUALLY PROBABLY NOT EVEN RELEVANT.

BARTIROMO: SO IT'S SORT OF LIKE THE NEW YORK STOCK EXCHANGE, AN ICE COMPANY.

SPRECHER: WE HAVEN'T THOUGHT ABOUT THAT YET BECAUSE IT'S KIND OF A DETAIL WE DON'T CARE ABOUT, BUT I KNOW IT'S SYMBOLIC TO A LOT OF PEOPLE ON THE FLOOR SO WE'RE THINKING WHAT SHOULD WE DO?

BARTIROMO: IS THERE AN ISSUE WITH ALL THOSE OTHER EXCHANGES? YOU'VE GOT ALL THESE NATIONALISTIC EXCHANGES THAT THEY'RE GOVERNED BY IN THEIR COUNTRY. ARE YOU GOING TO IPO THOSE ARE YOU GOING TO PACKAGE THEM?

SPRECHER: SO ONE OF THE THINGS THAT DUNCAN AND I TALKED ABOUT WHEN WE PUT THIS DEAL TOGETHER WAS SHOULD WE SPIN OUT PART OF THE EUROPEAN EXCHANGES? THE REASON IS EUROPE IS GOING THROUGH A BANKING CONSOLIDATION AND A REGULATORY CONSOLIDATION. ALL OF THIS TALK ABOUT THE EURO IS BRINGING THE FINANCIAL MARKETS TOGETHER. NYSE OWNS FOUR LARGE EXCHANGES IN EUROPE. AND THE QUESTION IS HOW DO WE BRING THOSE INTO THIS CONSOLIDATION? ONE WAY MAY BE TO TAKE THEM PUBLIC SO THEY CAN HAVE THEIR OWN CURRENCY AND CAN DO DEALS TO FURTHER HELP CONSOLIDATE EUROPE.

BARTIROMO: WE'LL LEAVE IT THERE. SO MUCH TO TALK ABOUT I REALLY WANTED TO GET YOUR TAKE ABOUT THE INDIVIDUAL AND WHAT'S HAPPENING IN CAPITAL MARKET THESE DAYS. SEEMS LIKE EVERYTHING IS STRAINED. BUT THAT CONVERSATION FOR ANOTHER DAY. GOOD TO HAVE YOU ON THE PROGRAM.

SPRECHER: THANK YOU, MARIA.

BARTIROMO: WE SO APPRECIATE YOUR TIME TODAY. BEST OF LUCK WITH THE DEAL.


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