Deutsche Boerse AG will absorb the NYSE in a $10 billion merger package with NYSE Euronext. 2 of the largest stock exchanges-NYSE, plus the Frankfurt Stock Market of Deutsche Boerse, would join together in the merger. The prospect of an NYSE-Deutche Boerse deal brought on alarm among patriots, who lamented the absorption of the New York Stock Exchange by foreign interests. This will keep someone high up from ever needing cash loans again.
What has to happen for the NYSE-Deutsche Boerse deal to work
New York Stock Exchange Euronext tries to be able to take over the financial market on a global stage. Deutsche Boerse is doing this also. The world's largest owner of derivatives and equities could be formed due to an all-stock package. One share symbolically can be swapped between Deutsche Boerse and New York Stock Exchange Euronext. Every NYSE Euronext share can be converted into 0.47 share of the combined company that values New York Stock Exchange Euronext at about $10 billion. Deutsche Boerse will hold 10 seats on the 17-seat board of the corporation, because its shareholders own about 60 percent of the merged shares. NYSE Euronext-Deutsche Boerse can have headquarters in New York and Frankfurt. Due to taxes, the combined business will incorporate in the Netherlands.
Putting derivatives to the package
In the United States and Europe, thousands of stock listing and choices and derivatives can be accessed by investors with the New York Stock Exchange Euronext-Deutsche Boerse. The merged entity will list corporations worth about $15 trillion, more than any stock exchange. The ownership of growing venues for derivatives, including wagers on stocks, bonds, currencies or commodities, or changes in interest rates, could be growing in ownership with the merger. Over 50 percent of earnings could come from derivatives by 2013 with the NYSE Euronext.
The impact on national pride
To some on Wall Street, the NYSE-Deutsche Boerse package is a blow to national pride. Just like the WA Monument and Golden Gate Bridge, several consider the Large Board at the NYSE as an American icon. The truth that U.S. institutions are no longer dominating the marketplace globally is seen as the European entity absorbed the NYSE. According to Senator Charles E. Schumer, D-N.Y., the package will only be approved under one condition. "New York" has to be the first name.
Information from
New York Times
dealbook.nytimes.com/2011/02/15/new-york-and-german-exchanges-seal-deal/
Business Week
businessweek.com/news/2011-02-15/deutsche-boerse-buys-nyse-to-form-top-exchange-owner.html
Market Watch
marketwatch.com/story/db-nyse-its-even-worse-than-we-thought-2011-02-15?reflink=MW_news_stmp
Wall Street Journal
blogs.wsj.com/deals/2011/02/15/deustche-borse-nyse-details-of-the-merger/
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