Now NYSE in merger talks with Deutsche

A SECOND giant stock exchange merger looked likely yesterday as Germany’s Deutsche Börse and multi-country platform NYSE Euronext confirmed they were in advanced talks.

The merger would create the world’s largest equities exchange by revenues and profit and generate about €300m (£254m) in cost savings from economies of scale, they said yesterday.

The announcement and suspension of their shares came just a day after news the London and Toronto Stock Exchanges will merge to create the world’s fourth-largest exchange trading $4.1 trillion (£2.5 trillion) of stock each year.

A merged Deutsche Börse and NYSE Euronext entity would have a market capitalisation of about £15bn.

“This transaction creates a group that is both a world leader in derivatives and risk management and the premier global venue for capital raising,” the exchanges said in a statement.

The merger would be an all-stock transaction, with Deutsche Börse investors holding about 59-60 per cent of the combined entity and NYSE Euronext shareholders allocated 40-41 per cent.

Deutsche Börse’s market cap was €11.4bn and NYSE Euronext’s €7.4bn yesterday. The exchanges discussed merging in 2008 and 2009 but have so far failed to reach agreement.