New Castle County (Del.) Executive Tom Gordon says he has purchased $3 million worth of 6 percent notes secured by "the county's exclusive lien on the license of software to be used running the Delaware Board of Trade," a proposed securities exchange, Gordon said in a statement Monday.
He's funding the software-backed investment with money from the Garstin Trust whose investment earnings are earmarked for county parks. Last summer the county approved a $15 million company-funded revenue bond issue to help finance the project. Last week the elected county council voted a resolution against the plan, but Gordon says he has "sole discretion" over the park money and says he sees signs council members will come around to his view.
Gordon and other Delaware local officials say they hope the exchange, which counts former Philadelphia Stock Exchange chair John Wallace, former New York Stock Exchange chair Richard Grasso, and other Wall Street veterans as backers and is run by ex-Nasdaq executive Nick Niehoff and Joe Biden aide Dennis Toner, will induce rich traders to move to Delaware so they can offer shares of "small- and medium-cap companies," whose stock offerings were deregulated by the federal "American JOBS Act" of 2013.
Officials and promoters haven't made clear why this government-subsidized exchange can be expected to draw a lot of well-paid securities professionals to the neighborhood, at a time when the recent proliferation of privately-funded securities exchanges more typically involves all-digital markets accessed remotely.
"Board of Trade officials have not yet announced an opening date," nor the name of the bank the board says is helping finance the project, details on the county's software collateral, or an opening date for the proposed exchange, spokeswoman robin brown (revised, spelling style corrected) said in answer to my questions. The City of Wilmington is also backing the project.