Friday, October 13, 2006
Borse Italiana to pursue D Börse merger
Borse Italiana to pursue D Börse merger
By Norman Cohen in London
Published: October 12 2006 22:14 | Last updated: October 13 2006 01:14
The board of Borsa Italiana has agreed to seek a memorandum of understanding to pursue merger talks with Deutsche Börse aimed at agreeing creation of a eurozone stock exchange that will include Paris-based Euronext.
The decision, which was almost unanimous, came after a protracted board meeting late on Thursday. The move appears to increase the pressure on Euronext, which has struck a deal to be acquired by the New York Stock Exchange despite growing opposition from France’s financial and political communities.
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Last week, a long-awaited report prepared for Paris Europlace, a politically well-connected French business lobbying group, recommended that Euronext delay its plans to be acquired by the NYSE until greater integration between European stock exchanges is complete. As a first step, it recommended that Deutsche Börse inject its cash equities market into Euronext in exchange for 15-20 per cent of Euronext’s share capital – a move that would make it the largest shareholder of the Paris-based exchange.
The report for Paris Europlace, prepared by French industrialist Henri Lachmann, also warns against an immediate merger with Deutsche Börse – a move proposed by the German exchange and favoured by a significant minority of shareholders – noting that the size of its potential partner may dilute French control.
In a statement this week, Euronext said it was prepared to acquire the cash equities businesses of both the Deutsche Börse and Borsa Italiana, and said its announcement is “suggested with the full support of the NYSE”.
“Euronext . . . believes that a combination of Euronext, and the cash equity trading activities of Deutsche Börse and Borsa Italiana is fully compatible with the anticipated merger between NYSE and Euronext,” it said. However, Euronext is facing growing pressure to delay, if not abandon, its plans to be acquired by the NYSE.
NYSE Group, which operates the New York Stock Exchange, would not comment on the German-Italian plan on Thursday night.
Euronext is firmly opposed to a merger with Deutsche Börse, which it says would face regulatory and implementation risks and could not be completed.
By Norman Cohen in London
Published: October 12 2006 22:14 | Last updated: October 13 2006 01:14
The board of Borsa Italiana has agreed to seek a memorandum of understanding to pursue merger talks with Deutsche Börse aimed at agreeing creation of a eurozone stock exchange that will include Paris-based Euronext.
The decision, which was almost unanimous, came after a protracted board meeting late on Thursday. The move appears to increase the pressure on Euronext, which has struck a deal to be acquired by the New York Stock Exchange despite growing opposition from France’s financial and political communities.
ADVERTISEMENT
Last week, a long-awaited report prepared for Paris Europlace, a politically well-connected French business lobbying group, recommended that Euronext delay its plans to be acquired by the NYSE until greater integration between European stock exchanges is complete. As a first step, it recommended that Deutsche Börse inject its cash equities market into Euronext in exchange for 15-20 per cent of Euronext’s share capital – a move that would make it the largest shareholder of the Paris-based exchange.
The report for Paris Europlace, prepared by French industrialist Henri Lachmann, also warns against an immediate merger with Deutsche Börse – a move proposed by the German exchange and favoured by a significant minority of shareholders – noting that the size of its potential partner may dilute French control.
In a statement this week, Euronext said it was prepared to acquire the cash equities businesses of both the Deutsche Börse and Borsa Italiana, and said its announcement is “suggested with the full support of the NYSE”.
“Euronext . . . believes that a combination of Euronext, and the cash equity trading activities of Deutsche Börse and Borsa Italiana is fully compatible with the anticipated merger between NYSE and Euronext,” it said. However, Euronext is facing growing pressure to delay, if not abandon, its plans to be acquired by the NYSE.
NYSE Group, which operates the New York Stock Exchange, would not comment on the German-Italian plan on Thursday night.
Euronext is firmly opposed to a merger with Deutsche Börse, which it says would face regulatory and implementation risks and could not be completed.
