London Stock Exchange and Deutsche Boerse Agree on Merger Terms
- The bidding war which was anticipated after ICE and CME had voiced their interest in the LSE has not materialized
Deutsche Boerse AG (ETR:DB1) and London Stock Exchange Stock Exchange A stock exchange, also known as a securities exchange or bourse represents is a facility where stockbrokers and traders can buy and sell securities.This includes shares of stock, bonds, exchange-traded funds (ETFs), or other financial instruments. By extension, stock exchanges can also provide facilities for the issue and redemption of such securities and instruments and capital events including the payment of income and dividendsStock exchanges have developed into a permanent fixture in the fin A stock exchange, also known as a securities exchange or bourse represents is a facility where stockbrokers and traders can buy and sell securities.This includes shares of stock, bonds, exchange-traded funds (ETFs), or other financial instruments. By extension, stock exchanges can also provide facilities for the issue and redemption of such securities and instruments and capital events including the payment of income and dividendsStock exchanges have developed into a permanent fixture in the fin Read this Term Group (LON:LSE) have today announced that the companies have reached a merger agreement. As a result, the prospects for a bidding war between the CME (Chicago Mercantile Exchange) Group and the ICE (InterContinental Exchange) have been dispelled.
A bidding war between the CME Group and the ICE was not to be
The companies have reached an agreement to merge and create one of the biggest players on the market, which will be streamlining a product list of multiple asset classes - derivatives, equities, fixed income, FX and energy products.
The unexpected quick conclusion of the deal has come less than a month after initial reports about the companies merging. Under the terms of the potential merger, LSE shareholders would be entitled to receive 0.4421 new shares in exchange for each LSE share and Deutsche Boerse shareholders would be entitled to receive one new share in exchange for each Deutsche Boerse share.
Based on this exchange ratio, the parties anticipate that Deutsche Boerse shareholders would hold 54.4 per cent, and LSE shareholders would hold 45.6 per cent of the enlarged issued and to be issued share capital of the Combined Group.
The negotiations between the companies are coming at a particularly challenging time, in the face of discussions about a European Union exit, which is to be voted on by the public in the United Kingdom in June.
Strengthening the link between Frankfurt and London will strengthen European capital markets
Commenting on the announcement the CEO of Deutsche Boerse, Carsten Kengeter, said: “Strengthening the link between the two leading financial cities of Europe, Frankfurt and London, and building a network across Europe with Luxemburg, Paris and Milan will strengthen European capital markets.
As a combined group we will create a European player that will compete on a global basis. Shareholders will have an opportunity to benefit from this industry defining and value enhancing combination through the Execution Execution Execution is the process during which a client submits an order to the brokerage, which consequently executes it resulting in an open position in a given asset. The execution of the order occurs only when it is filled. There is typically a time delay between the placement of the order and the execution which is called latency.In the retail FX space, reliable brokers always strive to deliver best execution to their clients in order to maintain a solid business relationship with them. This is a co Execution is the process during which a client submits an order to the brokerage, which consequently executes it resulting in an open position in a given asset. The execution of the order occurs only when it is filled. There is typically a time delay between the placement of the order and the execution which is called latency.In the retail FX space, reliable brokers always strive to deliver best execution to their clients in order to maintain a solid business relationship with them. This is a co Read this Term of an accelerated growth strategy and the realisation of cost and revenue synergies,” he added.
The LSE’s CEO Xavier Rolet added: “We are creating an industry-defining combination which will be a leading global market infrastructure business, very well positioned to create new benefits and efficiencies for our customers and increase value for our shareholders. Our highly complementary businesses will accelerate growth. Our shareholders will also benefit from substantial cost and revenue synergies.”
Deutsche Boerse AG (ETR:DB1) and London Stock Exchange Stock Exchange A stock exchange, also known as a securities exchange or bourse represents is a facility where stockbrokers and traders can buy and sell securities.This includes shares of stock, bonds, exchange-traded funds (ETFs), or other financial instruments. By extension, stock exchanges can also provide facilities for the issue and redemption of such securities and instruments and capital events including the payment of income and dividendsStock exchanges have developed into a permanent fixture in the fin A stock exchange, also known as a securities exchange or bourse represents is a facility where stockbrokers and traders can buy and sell securities.This includes shares of stock, bonds, exchange-traded funds (ETFs), or other financial instruments. By extension, stock exchanges can also provide facilities for the issue and redemption of such securities and instruments and capital events including the payment of income and dividendsStock exchanges have developed into a permanent fixture in the fin Read this Term Group (LON:LSE) have today announced that the companies have reached a merger agreement. As a result, the prospects for a bidding war between the CME (Chicago Mercantile Exchange) Group and the ICE (InterContinental Exchange) have been dispelled.
A bidding war between the CME Group and the ICE was not to be
The companies have reached an agreement to merge and create one of the biggest players on the market, which will be streamlining a product list of multiple asset classes - derivatives, equities, fixed income, FX and energy products.
The unexpected quick conclusion of the deal has come less than a month after initial reports about the companies merging. Under the terms of the potential merger, LSE shareholders would be entitled to receive 0.4421 new shares in exchange for each LSE share and Deutsche Boerse shareholders would be entitled to receive one new share in exchange for each Deutsche Boerse share.
Based on this exchange ratio, the parties anticipate that Deutsche Boerse shareholders would hold 54.4 per cent, and LSE shareholders would hold 45.6 per cent of the enlarged issued and to be issued share capital of the Combined Group.
The negotiations between the companies are coming at a particularly challenging time, in the face of discussions about a European Union exit, which is to be voted on by the public in the United Kingdom in June.
Strengthening the link between Frankfurt and London will strengthen European capital markets
Commenting on the announcement the CEO of Deutsche Boerse, Carsten Kengeter, said: “Strengthening the link between the two leading financial cities of Europe, Frankfurt and London, and building a network across Europe with Luxemburg, Paris and Milan will strengthen European capital markets.
As a combined group we will create a European player that will compete on a global basis. Shareholders will have an opportunity to benefit from this industry defining and value enhancing combination through the Execution Execution Execution is the process during which a client submits an order to the brokerage, which consequently executes it resulting in an open position in a given asset. The execution of the order occurs only when it is filled. There is typically a time delay between the placement of the order and the execution which is called latency.In the retail FX space, reliable brokers always strive to deliver best execution to their clients in order to maintain a solid business relationship with them. This is a co Execution is the process during which a client submits an order to the brokerage, which consequently executes it resulting in an open position in a given asset. The execution of the order occurs only when it is filled. There is typically a time delay between the placement of the order and the execution which is called latency.In the retail FX space, reliable brokers always strive to deliver best execution to their clients in order to maintain a solid business relationship with them. This is a co Read this Term of an accelerated growth strategy and the realisation of cost and revenue synergies,” he added.
The LSE’s CEO Xavier Rolet added: “We are creating an industry-defining combination which will be a leading global market infrastructure business, very well positioned to create new benefits and efficiencies for our customers and increase value for our shareholders. Our highly complementary businesses will accelerate growth. Our shareholders will also benefit from substantial cost and revenue synergies.”