NYSE Euronext has agreed to be bought by IntercontinentalExchange (ICE), an operator of Internet based marketplaces. The acquisition will add to ICE’s current operation of energy and commodity contracts, and derivatives markets worldwide. In the deal, ICE is to pay $33.12 per share; a premium of 38% of its pre-announcement share price, with two thirds of this being paid in stock and one third in cash. NYSE Euronext shareholders will hold 36% of the stock in the new company after it closes. The deal is expected to close in the second half of 2013.
NYSE Euronext is the operator of many securities exchanges (most notably the New York Stock Exchange) and is currently headquartered in Lower Manhattan, New York City. The firm itself was formed in 2007 from a merger of NYSE Group and Euronext, following a merger of NYSE and Archipelago Holdings in the year prior. The firm’s share price has increased by 31% since the announcement.
ICE Chairman and CEO Jeffrey Sprecher will maintain his role in the new company, whilst NYSE Euronext chairman and CEO Duncan Niederauer will become president of the company.
The press release for the transaction states that “As a result of the transaction, ICE clearing will be more capital efficient and provide operational efficiencies for clearing members” and that “ICE is committed to preserving the NYSE Euronext brand.” The transaction is expected to be achieve earnings accretion of over 15%.
View the press release here.
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