NYSE and Euronext merger to create first transatlantic stock exchange

02 June 2006

NYSE Group Inc, operator of New York Stock Exchange, and Euronext NV which operates the Paris-based stock exchange Euronext have announced a definitive agreement to merge the two companies. The agreement comes after months of speculation and a bidding war between NYSE and German stock market operator Deutsche Boerse.

NYSE Group Inc shareholders would receive one share of the merged entity for every share held by them. Euronext shareholders would receive 0.98 shares of the merged entity and €21.32 in cash for every share held. The merger is subject to regulatory and shareholder approvals.

Euronext currently operates electronic equities exchanges in Paris, Amsterdam and Brussels and a futures and derivatives exchange in London.

The combined entity would become the largest stock exchange in the world by a wide margin and would be called NYSE-Euronext. The merged entity would have a market capitalisation of $20 billion and average daily trading volumes of $100 billion. Total market capitalisation of companies listed on the exchange would be $27 trillion.

NYSE CEO John Thain would remain as CEO of the merged entity while the present Euronext CEO would become Deputy CEO responsible for European operations. NYSE Group would nominate 11 directors to the 20-member board while the balance would be Euronext nominees.

Last month, Deutsche Boerse had offered €7.72 in cash and 0.68 of a share in Deutsche Boerse in exchange for every share of Euronext.