BVLP – Bolsa de Valores de Lisboa e Porto – is joining Euronext after all its shareholders unanimously accepted Euronext’s merger offer.
Following the merger, BVLP shareholders will become shareholders of Euronext N.V., and BVLP a wholly-owned subsidiary of Euronext N.V., in a similar way to Euronext Paris, Euronext Amsterdam and Euronext Brussels, and will be renamed Euronext Lisbon. As a result of the merger Euronext will offer improved services to investors, intermediaries and issuers, gain access to an additional market and distribution network, increase its scale, extend the use of its trading and clearing systems, reinforce its position in the European exchange sector as well as further demonstrate that it is an expandable concept.
Upon full integration, Euronext and BVLP will provide users in Portugal with single trading, clearing and settlement platforms, offering enhanced liquidity, a central counterparty facilitating the netting of both cash and derivatives trades, and streamlined clearing and settlement.
In particular, Euronext’s cash trading platform based on NSC and its market model both successfully implemented in France in April 2001, in Belgium in May 2001 and in the Netherlands in October 2001, will also be implemented in Portugal, so that all the members of Euronext, including the Portuguese ones, will have access to all financial instruments traded on Euronext markets. For the derivative trading platform, all Euronext derivative products are expected to be traded on the LIFFE Connect system following a transitional period.
All cash and derivative trades will be cleared and guaranteed by Clearnet, Euronext’s clearing house and central counterparty, as it is already the case for all trades coming from Euronext Paris, Amsterdam and Brussels. The Clearing 21 system implemented in Paris will become the single platform for all Euronext markets.
Euronext and BVLP currently anticipate the simultaneous migration to the unified cash trading (NSC) and clearing (Clearing 21) platforms to be completed in the first quarter of 2003 and the simultaneous migration to the unified derivatives trading (LIFFE Connect) and clearing platforms to be completed in the third quarter of 2003.
Commenting on the merger, Jean-Franois Thodore, Chairman and Chief Executive Officer of Euronext, said:
“We are delighted to welcome BVLP within Euronext. We both share the same vision of a leading pan-European exchange respecting domestic regulatory frameworks, being more competitive by using the same platforms, and providing investors with a wider pool of liquidity.”
Commenting on the merger, Manuel Alves Monteiro, Chief Executive Officer of BVLP, said:
“We believe BVLP’s merger into Euronext is the best means to achieve the goal we have all pursued: the creation of better conditions for the listed companies, the members and the investors operating on the Portuguese market.”
This important strategic step towards the achievement of Euronext’s vision to be one of the leading global exchanges follows the launch of a merger offer on 20 December 2001, for which Euronext and BVLP have received valid acceptances of the offer in respect of a total of 6,000,000 BVLP shares, representing 100% of the issued share capital of BVLP. In aggregate, Euronext will issue 4,838,850 new Euronext shares (equivalent to 4 per cent of the fully diluted and enlarged share capital of Euronext) and pay Euro 35 million in cash for the entire share capital of BVLP.
The transaction will be declared unconditional following all necessary regulatoryapprovals.
Euronext is being advised by ABN AMRO and BVLP by Schroder Salomon SmithBarney.