EC blocks NYSE-Deutsche Borse merger
01 February 2012 at 18:16
Executives in investment compliance should be aware the European Commission has prevented a merger between NYSE Euonext and Deutsche Borse, it was announced today (February 1st).
According to the EC, the partnership of the two exchanges would create a monopoly of the market, preventing competitors from being able to pose credible threats to the merged company.
As it stands, the combined efforts of NYSE and Deutsche Borse already have more than a 90 per cent grip on global trade in these products.
Commission vice president in charge of competition policy Joaquin Almunia argued that the EC tried to come up with a solution to enable the acquisition but “fell short of resolving the concerns”.
He said: “The merger between Deutsche Borse and NYSE Euronext would have led to a near-monopoly in European derivatives worldwide.
“It is crucial for the whole European economy that they remain competitive.”
Although the merging companies suggested selling Liffe’s European single stock equity derivatives products where they competed with Eurex, the EC decided there would not be enough diversification for it to be viable.
Posted by James Harrison 