The London Stock Exchange (LSE) will sell Borsa Italiana for $ 5.09 billion (4.33 billion euros) in cash to Euronext, according to Reuters. LSE is selling Borsa as a regulatory remedy for $ 27 billion purchase of data provider Refinitiv, 45% owned by Thomson Reuters.

  • The deal is subject to the European Commission approving the Refinitiv deal  if all or part of Borsa Italiana is sold
  • Sale of Borsa Italiana to address EU’s competition concerns.
  • Euronext will fund the deal through debt and equity hike and the existing cash.
  • “Euronext will significantly diversify its revenue mix and geographical footprint by welcoming the market infrastructure of Italy”-Stephane Boujnah, Euronext CEO.
  • Deal expected to be accretive to Euronext’s adjusted earnings per share before synergies
  • Sale of Borsa is politically sensitive to Italy due to the company’s ownership of MTS, a platform that trades 2.1 trillion euro government bonds.. 
  • Euronext has partnered with Cassa Depositi e Prestiti (CDP), a state agency, and Italian biggest bank Intesa SanPaolo to secure a deal by state. 

Euronext’s stock is declining on the proposed purchase of Borsa Italiana. ENX is down 3.73%