Nasdaq OMX, ICE reinforce bid for NYSE

AP News
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Posted: Apr 19, 2011 1:10 PM
Nasdaq OMX, ICE reinforce bid for NYSE

Nasdaq OMX Group Inc. and Intercontinental Exchange Inc. are trying to reassure the owners of the New York Stock Exchange that they have adequate financing for their unsolicited $11.3 billion takeover bid and are willing to pay a hefty penalty if regulators object to it.

The companies, whose bid was rejected by NYSE Euronext Inc. in favor of an earlier $10 billion offer by German exchange operator Deutsche Boerse AG, argued in a letter to the chairman of NYSE Euronext chairman Tuesday that their proposal is superior.

NYSE Euronext confirmed that it received Nasdaq/ICE's proposal and said in a statement that it will review it "in due course."

Nasdaq and ICE said their offer is valued at $42.67 per NYSE Euronext share based on Monday's closing stock prices. That compares with $35.29 per share under the Deutsche Boerse bid, they said.

In a letter sent to NYSE Euronext Chairman Jan-Michiel Hessels, Nasdaq and ICE said they plan to buy NYSE Euronext shares that would give them voting securities valued at more than $66 million.

Nasdaq OMX and ICE said they have lined up $3.8 billion in financing and are prepared to pay $350 million to NYSE Euronext if they are unable to get antitrust regulators' approval for the deal.

Some analysts have said that the borrowing from lenders is a risk that could prompt ratings agencies to downgrade the NYSE.

Nasdaq and ICE are also seeking to meet with the NYSE Euronext board on their proposal. The companies complained earlier this month that their offer was rejected without discussion.

NYSE Euronext previously said that it decided to turn down the Nasdaq OMX/ICE offer because it was "highly conditional" and would have caused unnecessary risk for shareholders.

The proposed merger of Deutsche Boerse and NYSE Euronext would create the world's largest stock exchange operator. The rival bid from Nasdaq and ICE would split NYSE into two companies, with ICE taking on its lucrative derivatives business and Nasdaq taking its remaining businesses, which includes stock exchanges in Paris, Brussels, Amsterdam and Lisbon, as well as its U.S. options business.

NYSE is expected to hold its annual stockholders meeting on April 28.

Shares of Nasdaq OMX fell 6 cents to $27.51 in afternoon trading, while NYSE Euronext's stock gained 23 cents to $38.55. Shares of IntercontinentalExchange fell 27 cents to $119.57.