THE MEGA $8.2bn (£5.2bn) takeover of exchange group NYSE Euronext by upstart rival Intercontinental Exchange (ICE) is set to be approved by the EU, clearing the last major hurdle and paving the way for further industry consolidation.
The decision, first reported yesterday, brings an end to a period of obstruction from regulators who have stopped mergers between major stock exchanges on competition grounds.
Over the last three years they have blocked proposals to combine Deutsche Borse with NYSE Euronext, London Stock Exchange with Canada’s TMX, and an earlier combined bid by ICE and Nasdaq for NYSE Euronext.
Other deals – proposed in the face of falling revenue from equity trading – have also been blocked by regulators in Asia and Australia.
But the European Commission has not found any concerns that derivatives-focused ICE would reduce competition by purchasing NYSE Euronext, according to Reuters.
A spokesman for the European Commission declined to confirm this report but said a final decision has to be declared by 24 June at the latest, suggesting the organisation has concluded its investigation.
NYSE Euronext did not comment. It is understood the company has not received confirmation of approval from the Commission.
ICE, founded in 2000, has little interest in the traditional stock markets that it will acquire as part of its purchase. Instead, it wants control of Liffe – the London-based European derivatives exchange. Earlier this year the company eased concerns it could take a near-monopoly in the trade of coffee, cocoa and sugar by pledging to cap Liffe fees for these products for five years.
Meanwhile, ICE is thought to be exploring the possibility of offloading the rump of the business – which includes the Euronext bourses in Amsterdam, Brussels, Lisbon, London, and Paris – through an IPO. But the company has said it has no immediate plans to close the New York Stock Exchange’s iconic trading floor.