NYSE Euronext, Inc. was a transatlantic multinational financial services corporation that operated multiple securities exchanges, including the New York Stock Exchange, Euronext and NYSE Arca (formerly known as ArcaEx). NYSE merged with Archipelago Holdings on March 7, 2006, forming NYSE Group, Inc. On April 4, 2007, NYSE Group, Inc. merged with Euronext N.V. to form the first global equities exchange, with its headquarters in Lower Manhattan. The corporation was then acquired by Intercontinental Exchange, which subsequently spun off Euronext.
Overview NYSE Euronext provides financial products and services in cash equities, futures, options, exchange-traded products, bonds, market data and commercial technology. Its exchanges operated across several asset classes and six countries, and included the New York Stock Exchange, Liffe, Euronext and NYSE Arca. It had more than 8,000 listed issues, including 90% of the Dow Jones Industrial Average and 80% of the S&P 500. Trading on NYSE Euronext's equity markets accounted for more than one-third of global cash equities volume. The company also operated a major European derivatives exchange by value of trading.
NYSE Euronext is part of the S&P 500 index and the only exchange operator in the S&P 100 index.
NYSE Euronext is a Delaware corporation, though the principal executive office of NYSE Euronext is located at 11 Wall Street, New York, New York 10005. The European headquarters are at 39 Rue Cambon, 75001 in Paris, France.
Locations Below is a list of major NYSE Euronext locations: Amsterdam, Netherlands Belfast, Northern Ireland Brussels, Belgium Chicago, Illinois, United States of America Lisbon, Portugal London, United Kingdom New York City, New York, United States of America Palo Alto, California, United States of America Paris, France San Francisco, California, United States of America
Mergers and acquisitions
NYSE and Archipelago Holdings The merger between NYSE and Archipelago Holdings was initially approved in 2005 by a 95% majority of voting NYSE members. The acquisition of Archipelago, which held possession of highly regarded market technology at the time, was intended to bring automated trading to NYSE markets (which had previously utilized an "open outcry" system) and increase efficiency.
For the first time in its 213-year history, the New York Stock Exchange became a for-profit company, and began trading publicly on its own stock exchange under the NYX ticker. Owners of the 1,366 NYSE seats received 80,177 shares of NYSE Group stock plus $300,000 in cash and $70,571 in dividends for each seat. The completion of this deal created two new branches of the NYSE Group: NYSE Arca and NYSE Arca Europe, which launched after the acquisition of Euronext.
NYSE Group and Euronext merger April 4, 2007
In April 2006, NYSE Group and Euronext signed a merger agreement, subject to shareholder vote and regulatory approval. Euronext shareholders gave approval to the transaction on December 19, 2006, and shareholders from the NYSE Group followed suit one day later. In April 2007 the Euronext shareholders tendering shares can receive NYSE shares and cash amounting to $11,141 million from NYSE Euronext for their assets. About 94% of the 112,557,259 shares are tendered in the first round.Euronext N.V. Annual report for the year 2007
The NYSE Group and Euronext merger on April 4, 2007, signaled the creation of the world's largest and most liquid exchange group—NYSE Euronext.
NYSE Euronext and NYFIX NYSE Euronext, through its wholly owned subsidiary NYSE Technologies, Inc. acquired NYFIX, Inc. (Nasdaq: NYFX) for $144 million in November 2009. NYSE Euronext incorporated NYFIX's trading software into the company's package of offerings to customers.
Attempted merger between NYSE Euronext and Deutsche Börse In 2011, Bloomberg reported that the German exchange operator was in advanced talks to buy NYSE Euronext for $9.53 billion in a deal that would create the world's largest trading powerhouse. The shares of both companies were temporarily frozen on the news due to the risk of large price movements and clarifications of the deal. A successful deal would see the new company becoming the world's largest stock exchange operator with a market capitalization of listed companies equal to $15 trillion.
The proposed group would have dual headquarters, in Deutsche Boerse's newly built green tower near Frankfurt, Germany, and in New York City at 11 Wall Street. It would be led by a board with seventeen members, fifteen directors plus the chairman and the CEO. Of the fifteen directors, nine to be designated by Deutsche Boerse and six by NYSE Euronext. Current NYSE Euronext CEO Duncan Niederauer would assume the same role with the newly founded company and would lead an executive committee with an equal number of current Deutsche Boerse and NYSE Euronext executives.
On July 7, 2011, NYSE Euronext shareholders voted in favor of the merger, and on July 13, 2011, Deutsche Boerse shareholders approved the deal as well. These decisions move the two sides closer to completing the transaction, which must still pass through forty separate regulatory approval processes to be finalized.
The merger was subject to review in both the United States and with the European Union (EU) for concerns it could create a "de facto monopoly".
In October 2011, CEO Niederauer said the company had received the EU's so-called statement of objections, which was more than 100 pages long, and would be responding within two weeks, possibly by asking for the opportunity for an oral hearing with the regulators. The EU examination of the proposal formally began June 29 has said its expanded probe has a Dec. 13 deadline. In March, Joaquín Almunia, the EU's antitrust commissioner, expressed concern that the deal would maybe monopolize the derivatives market due to Deutsche Boerse's "vertical silo" which routes all trade clearing through its own services. Almunia said then he preferred a "more open business model" for markets.Rummer, Andrew, and Peter Chapman, editors, "NYSE Euronext May Seek EU Hearing to Defend Deutsche Boerse Deal", Bloomberg, October 13, 2011 11:06 am EDT. Retrieved 2011-10-13.
On December 22, 2011, Deutsche Boerse won U.S. antitrust approval to buy NYSE Euronext, on condition that a Deutsche Boerse subsidiary, the International Securities Exchange, divest its 31.5 percent interest in Direct Edge.Deutsche Boerse (DB1Gn.DE) won U.S. antitrust approval to buy NYSE Euronext (NYX.N) in a $9 billion deal to create the world's No. 1 exchange operator, but the transaction still faces serious regulatory headwinds in Europe. , Reuters, Dec 22, 2011. Retrieved 09-01-2012. NYSE Euronext and Deutsche Boerse AG delayed the deadline for completing their merger until March 31, 2012, so the exchange operators could try to persuade European regulators to approve the deal.NYSE, Deutsche Boerse Merger Date Extended , Bloomberg, Dec 28, 2011. Retrieved 09-01-2012.
On February 1, 2012, the European Union blocked the planned merger between NYSE Euronext and Deutsche Boerse. The European Commission—the EU's executive body—ruled against the merger because, they said, the combined exchange would control more than 90% of the trade in European derivatives. The European Commission report stated, "The merger between Deutsche Boerse and NYSE Euronext would have led to a near-monopoly in European financial derivatives worldwide... These markets are at the heart of the financial system and it is crucial for the whole European economy that they remain competitive".EU blocks Deutsche Boerse NYSE Euronext merger, The Associated Press, Feb 1, 2012. Retrieved 2012-02-01.
On February 2, 2012, the NYSE Euronext and Deutsche Börse agreed with strong opposition by the EU for the planned merger, to scrap the merger.NYSE Euronext Press Release
Intercontinental Exchange acquisition of NYSE Euronext On December 20, 2012, the boards of directors of both Intercontinental Exchange (ICE) and the NYSE Euronext approved an $8 billion acquisition of NYSE Euronext. Under the terms shareholders of NYSE would receive either $33.12 in cash for each share or .2581 IntercontinentalExchange Inc. shares, or a combination of $11.27 in cash per share plus .1703 shares of stock. The acquisition is subject to regulator approval, though since the operations of ICE and NYSE have little in common—ICE is largely devoted to trading commodities, as opposed to NYSE's business of trading stocks and securities—the deal is not expected to be blocked. ICE said that after the deal closed it would sell the Euronext portion of the company, including stock exchanges in Amsterdam, Brussels, Lisbon and Paris. The deal went through and Euronext is a sister division to NYSE and part of ICE. ICE CEO Jeffrey Sprecher would continue in that position at the combined company, while NYSE CEO Duncan Niederauer would serve as president. The future of the New York Stock Exchange's historic trading floor under ICE has not been announced. ICE closed the high profile and historic trading floors of its other earlier acquisitions, the International Petroleum Exchange and the New York Board of Trade in New York.
Company structure Derivatives The Derivatives segment consists of NYSE Euronext's derivatives trading and clearing businesses. This includes NYSE Liffe, NYSE Liffe Clearing, NYSE Liffe US, NYSE Amex Options, NYSE Arca Option, and related derivatives market data.
NYSE Liffe NYSE Liffe comprises the derivatives market operated by LIFFE Administration and Management, Euronext Amsterdam, Euronext Brussels, Euronext Lisbon, and Euronext Paris. It offers customers a derivatives trading platform as well as a wide choice of products.
Through a single electronic trading platform, NYSE Liffe offers customers access to a wide range of interest-rate, equity, index, commodity and currency derivative products. This platform has been designed to handle significant order flows and transaction volumes. Orders can be matched either on a price/time or pro rata basis, configurable by contract, with transacted prices and volumes and the aggregate size of all bids and offers at each price level updated on a real-time basis. Users can continually notified of all active orders in the central order book, making market depth easy to monitor.
NYSE Liffe also offers its customers the Bclear and Cscreen services, which bridge the listed and over-the-counter (OTC) markets. This provides a simple and cost-effective way to register and process wholesale derivatives trades through NYSE Liffe to clearing at NYSE Liffe Clearing. Following the launch of NYSE Liffe Clearing, NYSE Liffe assumed full responsibility for clearing activities on its own London market.
NYSE Liffe US, NYSE Euronext's U.S. futures exchange, makes available for trading full- and mini-sized gold and silver futures, options on full-sized gold and silver futures and futures on Morgan Stanley Capital International (MSCI) Indices. A significant minority equity stake in NYSE Liffe US is held by six external investors: Citadel Securities, DRW Investments, Getco, Goldman Sachs, Morgan Stanley and UBS. Under this ownership structure, NYSE Euronext remains the largest shareholder in the entity and consolidates its financial reporting. NYSE Euronext manages the day-to-day operations of NYSE Liffe US, which operates under the supervision of a separate board of directors.
NYSE Amex Options The NYSE Amex Options business uses a hybrid model combining both auction-based and electronic trading capabilities that is designed to provide a stable, liquid and less volatile market. This feature provides the opportunity for price and/or size improvement.