NYSE Stocks
NYSE to Acquire AMEX
By
Jan 22, 2008 - 4:48:54 PM

NYSE to Acquire AMEX

NYSE Euronext (NYSE Euronext: NYX), the world’s largest and most liquid exchange group, has entered into a definitive agreement to acquire the American Stock Exchange   The proposed business combination, which has been approved by both companies’ boards of directors, will significantly enhance NYSE Euronext’s scale in U.S. options, exchange traded funds (ETFs), closed-end funds, structured products and cash equities.  Subject to approval by Amex members and customary regulatory approvals, including from the U.S. Securities and Exchange Commission and Department of Justice, this transaction is expected to close in the third quarter of this year.

Under terms of the agreement, NYSE Euronext will pay $260 million in NYSE Euronext common stock for the Amex.  In addition, Amex members will be entitled to receive additional shares of NYSE Euronext common stock based on the net proceeds from the expected sale of Amex’s lower Manhattan headquarters.  

The acquisition of the Amex provides for a number of additional benefits and opportunities for NYSE Euronext:

• Obtain a second U.S. option exchange license, which will enable NYSE Euronext to operate a compelling dual market structure making available to all customers the choice of price-time priority on NYSE Arca and the Amex’s traditional market-maker model;
• Provide additional volume to NYSE Euronext’s robust U.S. options business, making it the third largest U.S. options marketplace;
• Operate a third, complementary U.S. cash equities exchange, in addition to the NYSE and NYSE Arca;
• Strengthen NYSE Arca’s leadership position in ETF listing and trading, joining 381 current Amex ETF listings with 240 NYSE Arca ETF listings;
• Offer a leading venue for listing and trading closed-end funds and structured products, including 545 listings on Amex and over 1,000 listings on NYSE;
• Realize annualized run rate cost synergies of over $100 million within two years from closing, including technology, data center and staff integration, consolidation of professional and contract services and vendors; and
• Relocate Amex’s trading floor operations to the NYSE trading floor.