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Reto Francioni

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.

bc