Commission to investigate stock-exchange merger plan

Deutsche Börse and NYSE Euronext aim to become the world’s largest stock and derivatives exchange.

The European Commission is to examine the planned merger between two of the world’s major stock exchanges.

Deutsche Börse and NYSE Euronext, which together aim to become the world’s largest stock and derivatives exchange, formally notified their intentions to Joaquín Almunia, the European commissioner for competition, yesterday (29 June).

Analysts say that clearance will not be straightforward and the complexity of the case makes it likely that the Commission’s investigation will take longer than the 25 working days that normally constitute the first phase of an antitrust investigation. It could move into a second stage and take up to another 90 days for Commission officials to complete their examination of the deal.

The two companies are both heavily involved in the trading of derivatives – financial instruments whose value is linked to that of other assets or market developments – and regulators have already indicated that Deutsche Börse’s ‘vertical silo’ model, in which it owns an exchange and derivative clearing house, will come under scrutiny.

‘Premier global exhange’

In a statement, the companies said that the merger would produce “the premier global exchange, allowing Europe to strengthen and solidify its role as one of the world’s most important finance centres”.

The NYSE Euronext board of directors has scheduled a meeting of shareholders for next Thursday (7 July), where they will seek approval for the merger. US regulators will also investigate competition concerns.

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