Deutsche Boerse, NYSE Merger Hits Snags


Sunday, February 13th, 2011
News

Senator Charles Schumer, an influential member on the Senate Banking Committee, has reversed his position on the NYSE Euronext and Deutsche Börse AG merger on the issue of who should lead the company. As details came out about the merger last week, the scare among investors was the fact that Deutsche Börse will now own the majority stake of this stock exchange. Initially, Senator Schumer indicated that the managerial components of the company would be handed over to an NYSE team headed by the new CEO Duncan Niederauer. Now Schumer’s spokesman Brian Fallon has released a statement saying that Senator Schumer had not intended to convey any “greater knowledge of the arrangement beyond Niederauer as CEO.”

The fear is that the comments by Schumer could stall the deal from going through as the merger is being sold in Germany as a German takeover of the NYSE or a “merger of equals” as indicated by Reuters. While little commentary on the issue has been made by US officials, other than the positives statements made by New York Mayor Mike Bloomberg and U.S. Representative Carolyn Maloney who is also of New York. However, internationally, French Economy Minister Christine Lagarde has expressed concern over what impact the merger could have on the broader global market.

According to the Wall Street Journal, the apprehension is compounded by the London Stock Exchange’s merger with Canadian exchange operator TMX Group Inc. Peter Randall, the chief executive of Equiduct, indicated that the deals may lead to more competition in the exchange industry. Some investors have taken these mergers to be a sign of the global equities markets being controlled by two super-exchanges. However, Simmy Grewel, infrastructure analyst at Aite Group, stated that the global equities market is unlikely to be affected by the anticipated mergers.

Sources:

1. http://online.wsj.com/article/BT-CO-20110213-704019.html

2. http://www.reuters.com/article/2011/02/14/us-nyse-deutscheboerse-schumer-idUSTRE71C1V420110214

3. http://www.bloomberg.com/news/2011-02-11/nyse-deutsche-boerse-merger-is-free-with-derivatives.html

 



Article by Andrew Timm

The views expressed are the subjective opinion of the article's author and not of FinancialAdvisory.com



Tags: derivatives , deutsche boerse , euronext , merger , nyse , schumer

Related Articles
Exchange Merger: OMX and IntercontinentalExchange (ICE) Make Hostile Bid for NYSE Euronext
Ventas Acquiring Nationwide in $7.4 Billion Merger
Merger Talks between Nasdaq OMX and ICE?
Deutsche Boerse-NYSE Merger to be Incorporated in Netherlands
CME Group Making Bid for NYSE?
Deutsch Boerse and NYSE Stock Exchange Merger Talks
Sanofi Expected to Make Offer to Genzyme This Week
Berkshire Hathaway (NYSE:BRK) Profitable in First Quarter
NYSE Euronext (NYSE:NYX) CEO Looking to Derivatives for Revenue Growth
AIG (NYSE:AIG) May Want Even More Taxpayer Money after Fourth Quarter Results
Give Your Opinion
What is the nasdaq market?
Share a simple answer to help inform others:
Specific to any country?
First name / Alias

• Your answer will be posted here:
What is the nasdaq market?
Financial Questions & Answers
Ask A Question
Get opinions on what you want to know:
Specific to any country?