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Euronext makes EUR510m offer for LCH.Clearnet SA

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Euronext has made an irrevocable EUR510 million all-cash offer to LCH.Clearnet Group Limited (LCH.Clearnet Group) and London Stock Exchange Group (LSEG) to acquire LCH.Clearnet SA (Clearnet).

Clearnet is a leading, multi-asset, Eurozone-based Central Counterparty (CCP) serving Euronext’s markets, pan-European electronic trading platforms and OTC markets, with gross income of EUR137 million and profit after tax of EUR36 million in 2015, and shareholders’ equity of EUR301 million.

Clearnet has commenced a period of consultation with its works council during which LSEG and LCH.Clearnet Group have granted exclusivity to Euronext.

Euronext says the acquisition will strengthen the company’s position at the heart of the Eurozone capital markets, by strengthening long-term control of clearing activities for Euronext’s markets, while enhancing its ability to innovate. It will also Improving Euronext’s business diversification (post-trade revenue to represent approximately 30 per cent of Euronext’s pro forma revenue). In addition, it will provide substantial growth opportunities in Fixed Income and CDS.

Euronext expects the acquisition to bring pre-tax operating cost synergies of EUR13 million and additional opportunities for revenue synergies.

Completion of the deal is subject to various conditions including: closing of the merger between Deutsche Börse AG (DB) and LSEG;  Euronext shareholder approval; customary regulatory and anti-trust approvals and other consents; and the ­completion of the works council consultation process of Clearnet.

Irrespective of the completion of the contemplated transaction, Euronext says it remains committed to delivering the best long-term solution for its post-trade activities, in the interests of its clients and shareholders

Stéphane Boujnah (pictured), Chief Executive Officer and Chairman of the Managing Board of Euronext, says: “The potential acquisition of Clearnet represents an opportunity for Euronext to achieve revenue growth and diversification. We will be in a position to provide our existing and future clients with a pan-European, fully integrated trading and post-trade platform. Euronext remains committed to delivering the best long-term solution for its post-trade activities in the interests of its clients and shareholders, irrespective of whether the acquisition of Clearnet is completed. We are looking forward to further strengthening our role as the leading integrated market platform of the Eurozone, powering pan-European capital markets to finance the real economy."

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