NASDAQ OMX Group and IntercontinentalExchange have made a joint proposal to acquire NYSE Euronext for $11.3 billion in cash and stock, beating by 19% the February offer by Deutsche Brse to buy the exchange group.
If the proposal succeeds, NASDAQ OMX would acquire the US and European markets of NYSE Euronext, while ICE would get Liffe, its derivatives business.
The offer by the joint groups of $42.50 in cash and stock is 27% higher than NYSE Euronexts unaffected share price on February 8, the day before Deutsche Brse made its offer.
Dow Jones previously reported that NASDAQ OMX was putting together a counter-offer for NYSE Euronext, but the speculation was billed as unlikely because NYSE Euronext is a far bigger entity its market cap is about $9 billion, compared to NASDAQ OMXs $4.5 billion. It is not yet apparent who has offered to finance the deal.
Analysts have said Deutsche Brse is not likely to increase its previous offer, which was approved by the NYSE Euronext board but was awaiting shareholder and regulatory approval. NYSE Euronext said in a statement early today that it will carefully review the proposal.
The combination of the two leading US exchanges delivers an opportunity to build a global exchange platform that has the scale and growth potential to benefit investors, issuers and other market participants, says Robert Greifeld, CEO of NASDAQ OMX. We believe it would increase transparency and liquidity in U.S. markets and create jobs as new companies raise capital. For Europe, it strengthens the equity markets by creating a new, truly pan-European equity trading platform and solidifies Paris and London as premier financial hubs.
Jeffrey C. Sprecher, ICE chairman and CEO, adds: “Given the dynamics in derivatives markets today, the pace of innovation and the need for competition, we are well positioned to bring more value to stockholders by ensuring that Liffe participates in the growth opportunities in our space. In addition to expanding our clearing capabilities to interest rates, we would enable increased competition in the US, where interest rates futures are dominated by one exchange with approximately 95% market share. And, in Europe, we would offer an attractive solution to preventing that same business from being dominated by a single competitor while preserving global innovation around additional risk management services.”