European exchange operator, Euronext which runs bourses in Amsterdam, Paris and Brussels among others, completed its acquisition of Borsa Italiana from the London Stock Exchange Group (LSEG) in a deal worth 4.4 billion euros, after initially agreeing to acquire the Milan bourse in October last year.
Euronext trumped rival bids by Germany’s Deutsche Boerse Swiss stock exchange operator Six, which offered to buy Borsa Italiana seven months ago.
Borsa Italiana is seen as a strategic asset in Italy because of its ownership of MTS SpA, the platform where the country’s 2.0 trillion euro debt is traded.
The LSEG confirmed in July last year that it was considering selling off the Italian bourse in order to satisfy the European Commission regarding its proposed $27 billion acquisition of data and analytics giant, Refinitiv. The deal was finally approved by the EU’s executive arm and completed in January earlier this year.
“LSEG’s intention is to use the net proceeds from the Borsa Italiana Group divestment to repay indebtedness related to the Refinitiv acquisition and for general corporate purposes,” said the LSEG in a statement on Thursday (April 29, 2021).
“Today marks a new chapter in the history of Euronext and of European capital markets,” said on Thursday (April 29) Stéphane Boujnah, Chief Executive Officer and Chairman of the Managing Board of Euronext.
“With the completion of the acquisition of the Borsa Italiana Group, Euronext delivers on its ambition to build the leading pan-European market infrastructure, connecting local economies to global capital markets, for the benefits of all market participants across Euronext’s markets.
“The significantly scaled-up Group is now positioned as the leading venue in Europe for listing and secondary markets for both debt and equity financing”.
“In addition, Euronext increases its business diversification with new capabilities in fixed income trading and clearing, as well as consolidation of a significant CSD. This transaction strengthens Euronext’s profile and enhances its strategic prospects for future growth.”
As part of the deal, Euronext’s data center will be moved from Basildon in Britain to Bergamo in northern Italy, where Italian data center operator Aruba S.p.A. runs a 200,000 square metre cloud data centre. The date targeted for the first part of the Group core data centre migration, subject to regulatory approval and operational readiness, is set for 2022, Euronext said in a statement.
“The migration is being planned in response to multiple factors, including the acquisition of the Borsa Italiana Group, the dynamic created by Brexit and a strong rationale to locate the Group’s core data centre in a country where Euronext operates a large business,” the leading pan-European market infrastructure said in a statement.
Euronext also reported on Thursday revenues up 5.2% at 249.2 million euros for the first quarter of 2021, driven by strong organic performance in non-trading activities and recent acquisitions. Earnings before interest, taxes, debt and amortisation (EBITDA) dropped 0.9% to 149 million euros. Borsa Italiana, meanwhile, reported stable revenues of 124.1 million euros for the same period.