29 Nov 2017 | 06.18 pm
Euronext Acquires The Irish Stock Exchange
Buyer sets aside €9 million for redundancies and integration measures.
29 Nov 2017 | 06.18 pm
Euronext has acquired 100 % of the shares and voting rights of The Irish Stock Exchange, Ireland’s stock exchange operator and a leading global debt and fund listing venue
Stockbroker Davy owns 38% of the ISE, Goodbody Stockbrokers owns 26.7% Investec owns 18.5% and Cantor Fitzgerald and Campbell O’Connor each own 8.4%.
The transaction value is €137m. In addition the Irish brokers will be able to pass on the €21.8m regulatory capital requirement to Euronext when the deal is finalised next year.
ISE chief executive Deirdre Somers commented: ”This is a landmark day in the 224-year history of ISE and a great day for our customers and our people. This transaction recognises the significant value and leading market position that has been built by the ISE. More importantly, we believe that Euronext is the perfect partner to enable us to achieve our growth ambitions.
“Euronext is hugely complementary to the ISE, bringing valuable expertise, financial strength, global relationships and technological capability as well as a global brand. These will enable our business to build further on its track record of international achievement and capitalise on new market and product opportunities emerging in Europe.”
Somers (pictured) will join Euronext’s Managing Board with group-wide responsibility for Debt, Funds and ETFs listing.
The Irish Stock Exchange is home to 51 listed companies with c. €122bn aggregate total domestic equity market capitalization. The Exchange is the the first debt listing venue globally (30,000+ securities and listings from 90 countries) and the first fund listing venue globally (5,24o Investment Funds Securities and 227 ETFs).
ISE generated revenue of €29.4m, operating profit of €9.6m and a net profit of €8m in 2016. For the first nine months of 2017, ISE turnover advanced by 13% year-on-year and EBITDA improved by 22%.
The purchaser indicated that the integration of ISE within Euronext is expected to generate cost synergies of €6m per annum, to be fully delivered in 2020, primarily driven by the migration to Optiq, Euronext’s trading platform, and rationalisation of support functions out of Dublin. Euronext anticipates incurring costs of €9m for redundancies and integration measures.
In 2016, The Irish Stock Exchange plc employed 121 people. Twenty five people are employed in information systems, 15 in finance, 8 in communications, 3 in HR, 5 in operations, 16 in market services and 26 in the regulation department. The total staff overhead amounted to €11.7 million, an average of €96,400 per person.