Euronext’s chief executive believes his company is in a win-win situation after it agreed a €510m (£433m) deal for the London Stock Exchange’s (LSE) French clearing arm, LCH SA.
The deal is tied to the LSE’s £21bn merger with Deutsche Boerse.
The LSE put LCH SA up for sale in September to help its merger go through, anticipating that clearing would be a major area of concern for EU competition regulator the European Commission.
Euronext, a pan-European exchange rival, has made its opposition to the mega-merger clear. But if – and only if – the LSE-DB deal goes through, so will the LCH SA deal.
“Now we are in a phase where we try to maximise the situation of Euronext, whatever the outcome is,” chief executive Stephane Boujnah told City A.M.
If the deal is approved, we believe that the position of Euronext will be strengthened by the acquisition… If the DB-LSE merger does not complete, the competitive environment will be fundamentally different.
Euronext was always seen as the frontrunner for LCH SA, in part because it contributes around half of the company’s revenue.
But US exchange companies such as CME Group and Nasdaq were also linked with the sale. And Boujnah said it had been a competitive bidding process.
“This deal attracted a lot of attention from many players,” he said. “It was a competitive auction. On the one hand, we were not alone – we were competing against other interested parties. On the other hand, we were the natural buyer.”