Euronext backs £6.8bn NYSE offer

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The Independent Online

Euronext's chief executive, Jean-François Théodore, emerged victorious yesterday after 98.2 per cent of the exchange operator's participating shareholders voted in favour of his plan to merge the company with the New York Stock Exchange.

The two groups aim to complete the merger - which will create the world's biggest exchange group by a long way - during the first quarter, assuming NYSE shareholders vote in favour at a separate meeting today.

The NYSE offer is worth €10.2bn (£6.8bn) and will create a combined group worth €21.9bn. M. Théodore has stood behind the plan despite heavy criticism from some quarters of the French establishment and a vocal group of shareholders, who pushed for an alternative deal with Deutsche Börse.

Their hopes of forcing him to change course were dashed when a sharp rise in the NYSE's share price increased the value of its cash-and-share offer to such a level that Deutsche was forced to withdraw. Deutsche also criticised Euronext for failing to pursue "a European solution".

However, a key selling point of the deal was that Euronext will retain its "federal structure", leaving local entities in control of local markets.

M. Théodore will become deputy chief executive of the merged group, which will be headed by the NYSE boss, John Thain.

M. Théodore told yesterday's meeting the new exchange behemoth could now "play a part in the second round of consolidation" with opportunities in Europe and Asia. He originally created Euronext from the merger of the Paris, Amsterdam and Brussels stock exchanges, later adding Liffe, the London futures exchange, by beating off rival bids from Deutsche and the London Stock Exchange.

He is, so far, the only exchange boss to have pulled off a merger of exchanges - attempts by rivals, which have involved the LSE, Deutsche, Sweden's OM Gruppen and the Nasdaq, have failed, although Chicago's futures exchanges are in the process of a merger which is due to complete in the middle of next year. M. Théodore said there were "substantial upside opportunities" for the combined group.

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