As exchanges around the world pair up as if it were the high school prom, traders and investors are wondering about the timing of the announcements as well as what’s in the mergers for them.
Deutsche Börse (DB) and NYSE Euronext announced a merger agreement in February that would create a mega exchange company with a market cap of more about $24 billion just days after the London Stock Exchange Group PLC (LSE) and the TMX Group, operators of the Montreal and Toronto exchanges, announced a merger of equals.
The DB/NYSE merger is expected to be completed by the end of 2011. At that time, DB shareholders will control 60% of the company and NYSE will control the remaining 40%. Dual headquarters will be established in Frankfurt and New York.
The combined entity would include 15 exchanges, four clearinghouses and would have produced revenue of €4.05 billion ($5.4 billion) in 2010. It would create the largest exchange for stocks and derivatives in the world.
Both mergers have been approved by the respective boards of directors and are awaiting regulatory and shareholder approval.
About the Author
Web Editor/Assistant Editor Michael McFarlin joined Futures in 2010, after graduating summa cum laude from Trinity International University, where he majored in English/Communication. With the launch of the new web platform, Michael serves as web editor for the site and will continue to work on the magazine, where he focuses on the Markets and Trading 101 features. He also served as a member of the Wisconsin National Guard from 2007 to 2010. mmcfarlin@futuresmag.com