Sat, Oct 1, 2016
A A A
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Industry Updates

Deutsche Börse AG and NYSE Euronext confirm advanced merger discussions

Thursday, February 10, 2011

Reto Francioni
Opalesque Industry Update – In light of recent market rumors, Deutsche Börse and NYSE Euronext confirmed that they are engaged in advanced discussions regarding a potential business combination. They cautioned that no agreement has been reached. They also noted that there cannot be any assurance that an agreement will be reached or, if an agreement is reached, that a transaction will be completed. Any transaction would be subject to regulatory and shareholder approvals, as well as other customary conditions.

This transaction creates a group that is both a world leader in derivatives and risk management and the premier global venue for capital raising. As a true pacesetter across the spectrum of capital markets services, the combined group will offer clients global scale, product innovation, operational and capital efficiencies, and an enhanced range of technology and market information solutions. The combined group, which would be the world’s largest exchange operator by revenues and profit and would continue to operate all exchanges under local regulatory frameworks and supervision, and would work closely with regulators to facilitate transparency and standardization of global markets.

It is expected that Deutsche Börse and NYSE Euronext would combine their businesses in all-stock transaction under a new legal entity incorporated in the Netherlands. If fully consummated, Deutsche Börse shareholders would hold approximately 59 to 60%, and NYSE Euronext shareholders would hold approximately 40 to 41%, of the combined company’s equity.

The combined group would have dual headquarters in New York and Frankfurt. The Chairman would be Reto Francioni, based in Frankfurt, and the CEO would be Duncan Niederauer, based in New York. The new company would have an Executive Committee drawn equally from the current leadership of both companies.

NYSE Euronext and Deutsche Börse AG expect to be able to realize approximately €300 million in cost synergies, principally from economies of scale in information technology, clearing operations, market operations and corporate center functions. In addition Deutsche Börse AG and NYSE Euronext expect to generate substantial incremental revenues from clearing services, product innovation and cross-selling opportunities between the global cash and derivatives businesses.

Deutsche Börse AG and NYSE Euronext believe that a combination could deliver value to clients, shareholders and other stakeholders in many ways, including:

  • Trading clients would benefit from significant savings available through common IT infrastructure, simplified clearing processes, capital efficiencies and the formation of a more liquid, pan-European, pan-Euro regulated market.
  • Deutsche Börse AG and NYSE Euronext shareholders would benefit from a more attractive revenue mix, accelerated earnings growth and from substantial cost savings.
  • The global capital markets would benefit from the creation of the most efficient, transparent and well-regulated markets for issuers and clients around the world. In particular, the combined company would create an important counterweight to the proliferation of alternative trading venues that operate with less transparency and far fewer regulatory requirements than either NYSE Euronext or Deutsche Börse AG.
(press release) www.deutsche-boerse.com


bc

What do you think?

   Use "anonymous" as my name    |   Alert me via email on new comments   |   
Today's Exclusives Today's Other Voices More Exclusives
Previous Opalesque Exclusives                                  
More Other Voices
Previous Other Voices                                               
Access Alternative Market Briefing

 



  • Top Forwarded
  • Top Tracked
  • Top Searched
  1. Opalesque Exclusive: BlackRock taps Artivest for alternative investment platform partnership[more]

    Bailey McCann, Opalesque New York: BlackRock will be working with New York-based Artivest to provide a platform for broader distribution of BlackRock alternatives funds. Artivest is a technology-driven alternative investment platform that also offers brokerage services. BlackRock has approximatel

  2. Eden Rock buys Gottex stake in ERG Asset Management[more]

    Matthias Knab, Opalesque: Eden Rock Group announced the purchase of Gottex’s stake in ERG Asset Management and so the firm is now wholly owned by Eden Rock. The two firms established the joint venture in 2011 to focus on providing cost effective solutions to funds holding illiquid investments, as

  3. "Hedge fund industry needs to shrink"[more]

    Komfie Manalo, Opalesque Asia: Writing for CNBC, Josh Brown, creator of The Reformed Broker blog and financial advisor for Ritholtz We

  4. Strategy - Voyager Management wants to invest in smaller hedge funds[more]

    From Valuewalk.com: Voyager Management, a $475 million fund of funds, is looking to downsize the hedge fund’s in which they invest, looking for smaller funds with assets under management that enable the fund to be nimble. The fund is looking for noncorrelation and will consider long / short equity

  5. Asia - Quant hedge funds are China's hot new export, Europe banks return to Korean brokerage market; target debt, alternative products[more]

    Quant hedge funds are China's hot new export From Bloomberg.com: Add China’s quant shops to the list of hedge funds branching out across Asian markets. Quantitative money managers from the world’s second-largest economy are opening offshore funds at a never-before-seen pace, according to