NYSE Euronext Board rejects $11 billion NASDAQ/ICE takeover offer

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NYSE Euronext Board rejects $11 billion NASDAQ/ICE takeover offer

2011-04-11 01:28:15 GMT+7 (ICT)

NEW YORK (BNO NEWS) -- NYSE Euronext on Sunday rejected an unsolicited joint proposal from NASDAQ and IntercontinentalExchange (ICE) to acquire the Euro-American corporation that operates several securities exchanges, including the New York Stock Exchange.

NASDAQ and ICE made the offer on April 1 and proposed to acquire NYSE Euronext for $42.50 in cash and stock per NYSE Euronext share, or approximately $11.3 billion. It represented a 19 percent premium over the price proposed by Deutsche Boerse.

In a statement released on Sunday by the NYSE Euronext Board of Directors, the Board said it consulted independent financial and legal advisors and as a result decided to reject what it said is a "highly conditional" proposal.

Under the terms of the proposed acquisition from NASDAQ/ICE, NYSE Euronext stockholders would have received $14.24 in cash, plus 0.4069 shares of NASDAQ OMX common stock and 0.1436 shares of ICE common stock for each NYSE Euronext share.

Further, as part of the rejected proposal, ICE would have purchased NYSE Euronext's derivatives businesses, and NASDAQ OMX would have retained NYSE Euronext's remaining businesses, including the NYSE Euronext stock exchanges in New York, Paris, Brussels, Amsterdam and Lisbon, as well as the U.S. options business.

But NYSE Euronext said the agreed combination with Deutsche Boerse, which owns the Frankfurt Stock Exchange, is consistent with the long-term strategy adopted by the NYSE Euronext Broad of Directors in 2009. It said a combination with Deutsche Boerse will position the combined company to be the leading global exchange operator and create 'substantially' more long-term value for shareholders.

"Breaking up NYSE Euronext, burdening the pieces with high levels of debt, and destroying its invaluable human capital, would be a strategic mistake in terms of where the global markets are going, and is clearly not in the best interests of our shareholders," said NYSE Euronext Chairman Jan-Michiel Hessels. "The highly conditional break-up proposal from Nasdaq/ICE would also require shareholders to shoulder unacceptable execution risk."

He added: "We are confident that the combination with Deutsche Boerse will create compelling value for our shareholders. With Deutsche Boerse, we are committed to creating the world's premier exchange group - a geographically diverse business, with strengths in multiple asset classes across the spectrum of capital markets services. The new company will fundamentally change the global exchange industry, establishing a world leader in both derivatives and risk management and the premier global venue for capital-raising."

Hessels said the combination of the two companies will be "financially powerful" with "a strong balance sheet, a world-class management team and an executable strategy."

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