Published: Wed, January 04, 2017
Economy | By Melissa Porter

Euronext makes irrevocable cash offer to buy LCH.Clearnet

Euronext makes irrevocable cash offer to buy LCH.Clearnet

London Stock Exchange Group PLC on Tuesday said it has received a cash offer for its LCH SA clearing house in France, the sale of which the United Kingdom group hopes will pave the way for its merger with German peer Deutsche Boerse AG to be approved by regulators.

The London Stock Exchange Group is to sell its 50% stake in the French clearing arm of LCH to Euronext in a €510m (£433m) deal.

"If the merger is not approved then we will be in a different environment", Euronext chief executive Stéphane Boujnah said.

The contemplated acquisition of Clearnet will allow Euronext to create one of the leading market infrastructure groups in the Eurozone and significantly diversify its revenue mix.

Deutsche Boerse operates the Frankfurt exchange, as well as the Luxembourg-based clearing house Clearstream and the derivatives platform Eurex.

The French firm pegged synergies at 13 million euros before taxes.

LSEG and LCH Group also confirmed that the terms and conditions on which any transaction would take place if the Put Option were exercised, including the all-cash consideration of €510 million (subject to customary adjustments), have been agreed with Euronext.

The transaction is expected to be double-digit accretive to Euronext's earnings from the first full year post completion, excluding integration costs and before synergies. LSE Group will use the proceeds for general corporate purposes and the sale will be conditional on the merger with Deutsche Boerse successfully completing. The Reference Shareholders of Euronext [5] support the acquisition of Clearnet by Euronext and will vote in favour of the transaction at the EGM.

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