The exchange tie-up is still subject to several closing conditions, including clearance by the European Commission in Brussels.
The final tally, announced Wednesday, Aug. 17, comes a little more than two months after the Deutsche Boerse published its voluntary public offer, which has meanwhile been approved by both sets of shareholders.
Shareholders had until last Friday to tender their shares.
The companies have given themselves until the end of June 2017 to complete the deal by way of scheme of arrangement, and the transaction is still subject to several closing conditions, including a review by the European Commission in Brussels as well as approval by financial, securities and other regulatory watchdogs.
“We will now focus on what achieving the necessary regulatory and antitrust approvals,” said Deutsche Boerse CEO Carsten Kengeter in a statement. “This merger will create a globally competitive market infrastructure group benefiting our customers, shareholders, and the wider economy.” Kengeter will serve as the CEO of the combined entity, while LSE CEO Xavier Rolet plans to step aside.
As soon as the paperwork is formally notified in Brussels, case workers will have 25 working days to conduct a Phase 1 review, which may be extended if the companies offer remedies to ease competition worries. If they decide to open an in-depth probe after that, that would add another 90 working days to the review, still well within the companies’ target for closing in the first half of next year.
Deutsche Boerse has not said whether it plans to pursue a squeeze-out of remaining shareholders. The exchanges announced an all-stock deal in mid-March to form a new powerhouse with dual headquarters in London and Frankfurt, to be 54.4% owned by Deutsche Boerse shareholders and 45.6% owned by LSE shareholders 45.6%.
Deutsche Boerse and LSE are joining forces after two failed attempts to walk down the aisle. The most recent was more than a decade ago when Rolet’s predecessor, Clara Furse, fought off a £1.35 billion ($1.3 billion) bid from Deutsche Boerse and several other takeover proposals during a period of heightened M&A activity among exchange operators worldwide.
The deal has gotten the nod from regulators in the U.S. and Russia but faces friction in Germany, where regulators have questioned the merger’s rationale following the June Brexit vote, and France, whose finance and economy ministers have both raised concerns over the merger as well.
Based on 2015 figures, London Stock Exchange and Deutsche Boerse had combined revenue of €4.7 billion ($5.3 billion), making the merged entity bigger than Intercontinental Exchange Group Inc. (ICE) and CME Group Inc. (CME). Deutsche Boerse shares gained 1.35% in Frankfurt Wednesday to €75.64, for a total market value of around €14.8 billion. LSE shares slid 1.25% in London to 2,845 pence, putting its market capitalization at roughly £10 billion.
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