As Deutsche Boerse AG shareholders approve its $9.2 billion takeover of NYSE Euronext, overcoming two of three hurdles in this process, GreySpark comments on what the implications and next steps are of this action.
Owners holding more than 80 percent of Deutsche Boerse shares backed the agreement, surpassing the 75 percent needed for approval under German law. The agreement clears the second of three main obstacles for the takeover following NYSE shareholders voting in favour of the transaction on July 7.
The final hurdle comes from the European regulators, who set an initial deadline of 4th August to rule on the deal, and review the transaction as it may potentially unite venues that handle more than 90 percent of the region’s exchange-traded derivatives. The deal may therefore encounter resistance.
GreySpark maintains this is not as bad as it looks. They insist that getting EU approval will be relatively straightforward. While the EU could block it on the basis of the final company having a dominant position, they have the opportunity to create a European leviathan in derivatives – a benefit to all financial entities in Europe.