Benefits of the transaction include:
- Acquisition will unlock significant value through the achievement of merger related cost synergies. ICE has successfully integrated more than a dozen acquisitions in the last decade, with a track record of delivering on or exceeding synergy commitments.
- The transaction is expected to be highly accretive to earnings in the first year after closing and produce returns on invested capital above the transaction's cost of investment beginning in year two.
- Model delivers strong operating leverage while preserving healthy levels of recurring revenues and participation in a market recovery, positioned to perform well in a rising interest rate and improved equity market environment.
- Strong cash flows and balance sheet of the combined company support continued investments in growth initiatives while facilitating rapid deleveraging post-close. ICE, upon closing of the transaction intends to adopt a dividend policy that will provide for an annual dividend payment of approximately$300 million. This amount represents the aggregate amount ofNYSE Euronext's current annual dividend payment.
- Provides for diversification among multiple asset classes and expands ICE's reach into new markets, including the world's largest asset class - interest rates - at current cyclical lows.
- Acquisition creates an unparalleled operator of global exchanges and clearing houses for agricultural and energy commodities, credit derivatives, equities and equity derivatives, foreign exchange and interest rates.
- Benefits from strong global presence, infrastructure and brands across international markets.
- NYSELiffeexecution and clearing will be merged into ICE Clear Europe, creating an efficient clearing model poised for growth as interest rate markets recover and interest rate swap clearing develops.
- ICE has proven transition capabilities and successfully launched ICE Clear Europe inNovember 2008, transferring approximately 26.5 million contracts and over$16 billionin initial margin.
Competition and Market Structure
- Builds on track record of improving market transparency and expands resources to address challenges and opportunities in equity market structure.
- Enhances innovation and competitiveness within U.S. and European rate markets.
- Operational and capital efficiency in implementation of new regulatory requirements with compliant solutions already in place.
- Emphasis on market safety and security via high-performance, integrated technology infrastructure.
ICE's lead financial advisor is Morgan Stanley; further financial advice is being provided byBMO Capital Markets Corp.,Broadhaven Capital Partners, JPMorgan, Lazard, Societe Generale Corporate & Investment Banking, andWells Fargo Securities, LLC. ICE legal advisors areSullivan & Cromwell LLPandShearman & Sterling LLP. The principal financial advisers toNYSE EuronextarePerella Weinberg Partnersand BNP Paribas. Legal advisers toNYSE EuronextareWachtell, Lipton, Rosen & Katz,Slaughter & May, andStibbe N.V.Further financial advice toNYSE Euronextis being provided byBlackstone Advisory Partners, Citigroup, Goldman Sachs & Co. andMoelis & Co.
Investor Conference Call An investor conference call will be held at 8:45 a.m. ET/1:45 p.m. GMT today, December 20, 2012, and is available via the ICE and NYSE Euronext websites. U.S. participants may dial 1 (866) 700-7441 and international participants may dial +1 (617) 213-8839. The participant code is 20593477. The call will be available for replay on each investor website. Media may participate in the call on a listen-only basis.