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December 20. 2012 8:36PM

IntercontinentalExchange to acquire NYSE for $8.2 billion

NEW YORK - IntercontinentalExchange Inc., the 12-year-old energy and commodity futures bourse, agreed to acquire NYSE Euronext for cash and stock worth $8.2 billion, moving to take control of the world's biggest equities market.

IntercontinentalExchange, based in Atlanta, will pay $33.12 a share for the owner of the New York Stock Exchange, 38 percent above Wednesday's closing price, according to a statement Thursday. Both boards approved the proposal and the companies expect to complete the transaction in the second half of 2013. Last year, the United States blocked a joint hostile bid by IntercontinentalExchange and Nasdaq OMX Group for the New York-based company on concern the combination would dominate U.S. stock listings.

Merging NYSE Euronext, which owns the biggest exchanges by value of listings in the U.S., France and the Netherlands, with the second-largest futures market underscores both the growing importance of derivatives and the diminishing influence of the 220-year-old NYSE. The Big Board, once the benchmark for global free markets, has seen its share of trading in stocks listed on the exchange decline to 21 percent from 82 percent.

"Not only are they losing volume, they're also getting squeezed in their margins because of all these competitors who have different corporate structures,"

Thomas Caldwell, who oversees about $1 billion as chairman and chief executive officer of Toronto-based Caldwell Securities, said in a telephone interview.

His firm owns shares of NYSE and ICE. Jeffrey Sprecher, the chief executive officer of IntercontinentalExchange, will head the combined company, with NYSE CEO Duncan Niederauer becoming president. The companies plan to explore an initial public offering for NYSE's European equity unit.

IntercontinentalExchange's market value has grown to $9.3 billion as its shares rose 7.4 percent in 2012, data compiled by Bloomberg show.

A takeover would mark an unusual success after more than $32 billion of exchange takeovers failed since October 2010.

"This is a much easier deal to get done," said Brian Barish, who helps oversee about $7 billion including about 4 million NYSE Euronext shares as president and chief investment officer of Denver-based Cambiar Investors. "When Nasdaq was talking about doing something with NYSE, there were obvious antitrust market concentration problems. ICE is a totally different story because they don't do equities."


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