NYSE Board Rejects Nasdaq Merger Bid

NEW YORK CITY-The NYSE Euronext board of directors has voted to reject the $11.3-billion bid for the company by Nasdaq OMX and IntercontinentalExchange Inc., which would have kept Manhatttan as the combined company’s base. In a release issued Sunday, NYSE Euronext says the Nasdaq/ICE offer, which tops the previously announced $9.5-billion merger agreement with Frankurt-based Deutsche Boerse AG, would lead to the breakup of NYSE Euronext, owner of the New York Stock Exchange.

The decision to stick with the NYSE Euronext/Deutsche Boerse agreement is consistent with the long-term strategy the NYSE Euronext board adopted in 2009, according to the release. It will position the combined company to be “the leading global exchange operator” while creating “substantially more long-term value” for shareholders, the release states. It is also more likely to close than the Nasdaq/ICE deal would have been, according to the release.

“Breaking up NYSE Euronext, burdening the pieces with high levels of debt and destroying its invaluable human capital, would be a strategic mistake in terms of where the global markets are going, and is clearly not in the best interests of our shareholders,” NYSE Euronext chairman Jan-Michiel Hessels says in a statement. “The highly conditional break-up proposal from Nasdaq/ICE would also require shareholders to shoulder unacceptable execution risk.”

In a statement of its own, Nasdaq OMX says that NYSE Euronext’s board of directors, “without engaging in any dialogue or discussion, has summarily elected to deny its stockholders the opportunity to benefit from a clearly superior proposal to the announced transaction with Deutsche Boerse.” Nasdaq calls the Deutsche Boerse offer “indisputably financially inferior.”