Euronext open to merger with Deutsche Börse

Euronext, the operator of the Lisbon stock exchange, is open to a merger with rival Deutsche Börse, according to comments by chief executive Stéphane Boujnah cited by the Financial Times. The prospect matters for international investors because such a deal could create a much larger European market infrastructure group at a time when the region is trying to strengthen its capital markets.

Boujnah said a combination of the two exchange businesses could improve liquidity and make European markets more competitive, but he also warned that any full merger would face major regulatory hurdles. He added that there are currently no talks between the two groups.

Euronext runs exchanges in Lisbon, Amsterdam, Brussels, Dublin, Milan, Oslo, Paris and Athens. According to the report, it handles about 25% of European cash equity trading, with more than 1,800 listed companies and a market capitalisation of €16 trillion. Deutsche Börse operates the Frankfurt exchange and Eurex, one of the world’s largest derivatives trading platforms.

The idea of combining the two groups has circulated for decades. Deutsche Börse withdrew a bid for Euronext in 2006, and a later merger attempt was blocked by the European Commission on competition grounds in 2012. Boujnah said that, in theory, building a pan-European market infrastructure group on a “global scale” would be an interesting option for Europe.

Originally published at Eco.pt