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By Clara Denina
LONDON, July 9 (Reuters) - The London Metal Exchange and technology firm Autilla teamed up on Wednesday to launch a last-minute bid to run the new global silver price benchmark in the closely fought contest to replace the 117-year old London "fix."
The Autilla/LME camp's proposal for an electronic system will likely challenge a joint proposal from exchange operator CME Group Inc and Thomson Reuters Corp, who are also in the final running, sources who were not competing in the process have told Reuters.
The London Bullion Market Association (LBMA), the industry body coordinating the search for a new mechanism, said on Wednesday the results of the high-profile process are likely by the end of the week. It had been due earlier this week.
The winner will operate a new daily silver pricing benchmark to replace London's century-old silver fix when it ends on Aug. 14 as regulatory scrutiny of price-setting intensifies across markets.
The LBMA has been consulting with market participants since May with the aim of producing a transparent electronic alternative to the conference call that complies with toughened regulatory standards.
"Throughout the LBMA's process, the market has consistently indicated that Autilla's technology and the LME's compliance and price discovery systems are market-leading," LME Chief Executive Garry Jones said in a statement.
The LME and Autilla, run by former brokers and traders from some of the fixing banks, had originally presented separate proposals.
The exchange had said it would use its electronic platform LMESelect, which was already available to LBMA market-makers such as JPMorgan and Societe Generale.
Members of the association, which count gold and silver fixing banks and other large bullion-trading banks, discussed the seven original proposals at a meeting on Friday, without reaching any decision.
After a months-long consultation involving market participants across the industry, the bid from CME and Thomson Reuters Benchmark Services Ltd had been considered a strong contender out of seven proposals, sources have told Reuters.
Thomson Reuters and the CME declined to comment.
Other bidders include U.S. derivatives exchange Intercontinental Exchange (ICE), U.S. news agency Bloomberg, commodity price benchmark provider Platts, a unit of McGraw Hill Group ; and UK-based exchange-traded funds provider ETF Securities.
The banks involved in the current silver fixing process are Deutsche Bank, HSBC and Bank of Nova Scotia-ScotiaMocatta.
The LME currently provides clearing of over-the-counter silver forward rates in conjunction with London clearing house LCH.Clearnet, which are marked to market using the LBMA forward curve.
"The solution will be ready for testing from 14 July, with implementation and roll-out to begin in early August," the exchange said.
An electronic solution to the silver fix could be applied to price-setting for gold and platinum group metals as well, sources said.
The silver fix is set every day at noon by three banks via a conference call, working out a price at which their customers are willing to buy and sell the metal. (Additional reporting by Josephine Mason in New York; Editing by Veronica Brown, Jane Baird, Jonathan Leff and Jonathan Oatis)