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IntercontinentalExchange To Acquire NYSE Euronext For $33.12 Per Share In Stock And Cash, Creating Premier Global Market Operator

“The Board of NYSE Euronext carefully considered a range of strategic alternatives and concluded that ICE is the ideal partner for NYSE Euronext in an evolving market landscape," said Jan-Michiel Hessels, Chairman of the Board of NYSE Euronext. "We look forward to working with ICE to complete this compelling, value-enhancing combination."

“This transaction leverages the strength of our iconic brand and the value we have created in our global equity and derivatives franchises – positioning the business for solid long-term growth and development,” said Duncan L. Niederauer, CEO of NYSE Euronext. “We are bringing together two highly complementary businesses, creating an end-to-end multi-asset portfolio that will be strongly positioned to serve a global client base and capture current and future growth opportunities.”

Benefits of the transaction include:

Financial
  • Acquisition will unlock significant value through the achievement of merger related cost synergies. ICE has successfully integrated more than a dozen acquisitions in the last decade, with a track record of delivering on or exceeding synergy commitments.
  • The transaction is expected to be highly accretive to earnings in the first year after closing and produce returns on invested capital above the transaction’s cost of investment beginning in year two.
  • Model delivers strong operating leverage while preserving healthy levels of recurring revenues and participation in a market recovery, positioned to perform well in a rising interest rate and improved equity market environment.
  • Strong cash flows and balance sheet of the combined company support continued investments in growth initiatives while facilitating rapid deleveraging post-close. ICE, upon closing of the transaction intends to adopt a dividend policy that will provide for an annual dividend payment of approximately $300 million. This amount represents the aggregate amount of NYSE Euronext’s current annual dividend payment.
  • Provides for diversification among multiple asset classes and expands ICE’s reach into new markets, including the world’s largest asset class - interest rates - at current cyclical lows.

Operational
  • Acquisition creates an unparalleled operator of global exchanges and clearing houses for agricultural and energy commodities, credit derivatives, equities and equity derivatives, foreign exchange and interest rates.
  • Benefits from strong global presence, infrastructure and brands across international markets.
  • NYSE Liffe execution and clearing will be merged into ICE Clear Europe, creating an efficient clearing model poised for growth as interest rate markets recover and interest rate swap clearing develops.
  • ICE has proven transition capabilities and successfully launched ICE Clear Europe in November 2008, transferring approximately 26.5 million contracts and over $16 billion in initial margin.

Competition and Market Structure
  • Builds on track record of improving market transparency and expands resources to address challenges and opportunities in equity market structure.
  • Enhances innovation and competitiveness within U.S. and European rate markets.
  • Operational and capital efficiency in implementation of new regulatory requirements with compliant solutions already in place.
  • Emphasis on market safety and security via high-performance, integrated technology infrastructure.

ICE’s lead financial advisor is Morgan Stanley; further financial advice is being provided by BMO Capital Markets Corp., Broadhaven Capital Partners, JPMorgan, Lazard, Societe Generale Corporate & Investment Banking, and Wells Fargo Securities, LLC. ICE legal advisors are Sullivan & Cromwell LLP and Shearman & Sterling LLP. The principal financial advisers to NYSE Euronext are Perella Weinberg Partners and BNP Paribas. Legal advisers to NYSE Euronext are Wachtell, Lipton, Rosen & Katz, Slaughter & May, and Stibbe N.V. Further financial advice to NYSE Euronext is being provided by Blackstone Advisory Partners, Citigroup, Goldman Sachs & Co. and Moelis & Co.

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