# London Stock Exchange Group Plc to sell LCH SA to Euronext NV for €510 million

- Link: https://www.directorstalkinterviews.com/london-stock-exchange-group-plc-sell-lch-sa-euronext-nv-e510-million/412719677
- Published: 2017-01-03T07:16:27+00:00
- Author: Giles Arbor

**[London Stock Exchange Group plc](https://www.directorstalkinterviews.com/ftse-company/london-stock-exchange-group/lseg.l)**(
LON:LSE) and LCH Group Limited (“LCH Group”) announced today that they have received
an irrevocable all-cash offer from Euronext N.V. (“Euronext”) to purchase LCH SA,
LCH Group’s French-regulated operating subsidiary (the “Transaction”). LCH SA has
commenced a period of consultation with its works council during which LSEG and 
LCH Group have granted exclusivity to Euronext.

LSEG and LCH Group confirm that the terms and conditions, including the financial
terms on which any Transaction would take place if the irrevocable offer were accepted,
have been agreed with Euronext offering an all-cash consideration of €510 million
to be adjusted for surplus regulatory capital movement between 30 June 2016 and 
completion of the Transaction. LSEG will use any proceeds it receives for general
corporate purposes.

The proposed sale of LCH SA would be subject to review and approval by the European
Commission in connection with the recommended merger of LSEG and Deutsche Börse 
AG which was announced on 16 March 2016 (the “Merger”). It would also be conditional
on the successful closing of the Merger.

In addition, the Transaction would be conditional upon the receipt of various regulatory
and other consents and approvals, the completion of LCH SA’s works council consultation
process and Euronext shareholder majority approval at an Extraordinary General Meeting
to be held in the first quarter of 2017. Euronext has received support in favour
of the Transaction from reference shareholders (“Reference Shareholders”) who in
their entirety comprise 33.36% of the share capital of Euronext. Under the terms
of the Reference Shareholder agreement, all Reference Shareholders are obliged to
vote in accordance with the recommendation of a two-third majority of Reference 
Shareholders1.

For the fiscal year ending 31 December 2015, LCH SA generated net profit of €36 
million and held gross assets of €260 billion and net assets of €303 million. For
the six month period ending 30 June 2016, LCH SA generated €69 million of gross 
income, and held net assets of €301 million2.

Following the proposed Transaction London Stock Exchange Group plc will continue
to hold its other existing clearing assets. LSEG today operates multiple central
counterparties (“CCPs”): LCH Group, the multi-asset global CCP operator which has
legal subsidiaries in the UK (LCH Ltd), the US (LCH LLC), France (LCH SA), and CC&
G in Italy.

LCH Group operates an open access model, offering a choice of execution venues and
delivering unprecedented choice and efficiencies to the marketplace.

1 https://www.euronext.com/sites/www.euronext.com/files/euronext-nv_2015_registration_document.
pdf
 2 All numbers are based on unaudited IFRS figures, adjusted for intercompany
charges including those charged for IT and management services provided by other
LSEG entities

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