Euronext makes irrevocable cash offer to buy LCH.Clearnet

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Euronext makes irrevocable cash offer to buy LCH.Clearnet

London Stock Exchange is divesting LCH SA ahead of a planned merger with Germany's Deutsche Boerse (DBOEY) as part of an effort to sweeten regulators who are investigating the competition aspects of the deal.

About a week later the LSE and its clearing arm, LCH, announced that they were in exclusive discussions with Euronext.

Euronext aims to strengthen its position within Eurozone markets and diversify its offerings through the addition of a multi-asset central counterparty (CCP).

Stéphane Boujnah, Chief Executive Officer and Chairman of the Managing Board of Euronext said: "The potential acquisition of Clearnet represents an opportunity for Euronext to achieve revenue growth and diversification".

Euronext stock opened the new year with a bang on Tuesday after it emerged the exchange operator will buy the French clearing operation of London Stock Exchange (LDNXF) in a €510 million ($532 million) deal.

The French firm pegged synergies at 13 million euros before taxes.

Deutsche Boerse operates the Frankfurt exchange, as well as the Luxembourg-based clearing house Clearstream and the derivatives platform Eurex.

Euronext said it expected the deal to add to its earnings from the first full year in the double digits, before costs pegged at 40 million euros.

The LSE and Deutsche Boerse merger would create a financial markets behemoth competing with the likes of the Chicago exchange and ICE in the United States, as well as the Hong Kong stock exchange in Asia. Euronext has received support in favour of the Transaction from reference shareholders ("Reference Shareholders") who in their entirety comprise 33.36% of the share capital of Euronext.

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