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Deutsche Boerse, Euronext to merge
Wed, 16 Feb 2011 00:09:21 GMT
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Traders gather at the post that handles shares of NYSE Euronext as they wait for trading to resume, on the floor of the New York Stock Exchange. (file photo)
The German stock exchange Deutsche Boerse and NYSE Euronext have agreed to a merger that would create the world's biggest exchange by revenues and a powerhouse in derivatives trading.

In the deal, the shareholders of Deutsche Boerse's Frankfurt stock exchange will own 60 percent of the shares and NYSE Euronext shareholders will receive 40 percent, AFP reported on Tuesday.

The combined German-US company is expected to generate annual cost savings of $400 million and will have 2010 combined revenues of $5.4 billion.

The new Netherlands-incorporated firm will be chaired by Deutsche Boerse's Reto Francioni, with dual headquarters in Frankfurt and New York.

NYSE Euronext Chief Executive Officer Duncan Neiderauer is also expected to be appointed as the CEO of the yet-unnamed new company, whose new board will have nine directors selected by Deutsche Boerse and six by NYSE Euronext.

Against the backdrop of the severe shakeup in the global securities and derivatives markets industry, it is said that the merger will help develop the global capital markets' community and deliver the most transparent and innovative services to clients and issuers.

"We will create a new leader in the global exchange industry," said Francioni, adding that the merger makes "tremendous economic sense" as it is forecast to generate savings technology efficiencies and is expected to become more attractive to corporate issuers and customers.

He went on to say that the combined company would be a "tremendously attractive partner" for tie-ups with exchanges in Asia, Eastern Europe, and South America.

The deal bodes well for Deutsche Boerse as the company seeks to strengthen its international profile.

The firm has been in merger talks with NYSE Euronext since 2009.

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