Euronext has confirmed plans to acquire Borsa Italiana from the London Stock Exchange Group (LSEG) for just over €4.3 billion as part of its long-term strategy of becoming a pan-European market infrastructure powerhouse.
The Milan-based bourse, which is Italy's only exchange, earned €464 million revenue last year and Euronext hopes it will “play a key role in the future operations, strategy and governance” of its expanded group, as its largest revenue contributor.
The combined entity “significantly enhances” the scale of Euronext, diversifies its business mix into new asset classes as well as strengthening its post-trade activities, it said.
The deal is dependent on LSEG being required to sell Borsa Italiana Group as a condition of the European Commission’s clearance of its acquisition of Refinitiv, a global market data provider.
Securing an exchange from a G7 country marks a major step forward for Euronext’s ‘Let’s Grow Together 2022’ strategic plan which previously saw it snap-up exchanges in Dublin, Amsterdam and Paris.
Stéphane Boujnah, CEO and chairman of the managing board of Euronext, said: “Thanks to this transaction, Euronext will significantly diversify its revenue mix and its geographical footprint by welcoming the market infrastructure of Italy, a G7 country and the third-largest economy in Europe.
“The proposed combination will create the backbone of the Capital Markets Union in Europe,” he added.
Euronext entered into exclusive talks with LSEG on the purchase last month after beating rival bids from Deutsche Boerse and SIX Group.
To secure the bid, Euronext has partnered with CDP Equity, an Italian sovereign wealth fund formerly known as Fondo Strategico Italiano, and Intesa Sanpaolo, an Italian banking group.
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