Euronext, a pan-European group managing the national stock exchanges of five European countries, has launched an all-cash bid to acquire the owner of the Oslo stock exchange, as part of its drive to diversify from share trading.
The operator of stock exchanges in Paris, Amsterdam, Brussels, Dublin and Lisbon, said in a statement that it had approached the board of directors of the Oslo Stock Exchange (Oslo Bors VPS) to seek its support for a EUR625 million cash tender offer for all the outstanding shares of Oslo Børs VPS, the Norwegian Stock Exchange and national CSD operator, based in Oslo.
The European stock exchange conglomerate said was particularly attracted to Oslo Bors' position in seafood derivatives as well as oil services and shipping.
“Euronext strongly believes that Oslo Børs VPS` unique strategic and competitive positioning, including a global leading position in seafood derivatives and a deep-rooted expertise in oil services and shipping, would further strengthen Euronext`s position as the leading market infrastructure for the financing of the real economy in Europe,” read the statement.
Oslo Bors' listings are dominated by companies such as Equinor, Aker BP, Aker Solutions, Subsea 7 and Kvaerner (oil sector) as well as Marine Harvest, the world's leading fish farmer and Leroy Seafood.
Euronext approached the board of Oslo Bors after securing the support of 49.6 percent of the firm’s shareholders. The pan-European stock exchange is offering 145 Norwegian kroner ($16.53) apiece for the remaining shares, representing a 32 percent premium on Oslo Bors VPS`s closing price on 17 December 2018 (the day before Euronext submitted its bid) and 34% on Oslo Bors VPS`s 3-month volume-weighted average share price.
"We will not need to go to the market, we will use our cash," Euronext CEO Stephane Boujnah told Reuters, adding Euronext had long standing contacts and interest in the almost 200-year-old Oslo trading exchange operator, viewing it as a "natural partner".
Euronext`s offer will be subject to certain customary conditions including a short due diligence period, minimum acceptance threshold of 50%, regulatory approvals and a favourable vote of Euronext shareholders. If its offer is accepted, Euronext said it would be fully committed to support the development of Oslo Børs VPS and of the broader Norwegian financial ecosystem.
Oslo Bors, the central marketplace for the listing and trading of financial instruments in the Norwegian market, is the only major Nordic bourse to remain independent: Nasdaq OMX Group Inc., the major electronic stock exchange, runs the national stock exchanges in Sweden (Nasdaq Stockholm), Finland (Nasdaq Helsinki), Denmark (Nasdaq Copenhagen) and Iceland (Nasdaq Reykjavik).
Euronext is also on a buying spree. Earlier this year, it acquired the Irish Stock Exchange. Since its founding in October 2000, the Amsterdam-based securities and derivatives exchanges operator has expanded across not only geographic trading hubs but also across other sectors of the electronically traded capital markets business.
There was no trading on the Oslo Stock Exchange on Christmas Eve, and therefore there were no immediate outlets that could provide clues as to how investors in Norway perceived Euronext's offer on the market.
US stock market operator Nasdaq, which already operates seven exchanges across the Nordic and Baltic countries, made a rival bid for Oslo Bors. Nasdaq’s bid of 152 Norwegian crowns per share, valuing Oslo Bors at 6.54 billion crowns ($771 million), topped Euronext’s bid of 145 crowns per share.
Nasdaq said it could merge Oslo Bors with Norway-based Nasdaq Commodities.
“You can safely say that for Nasdaq, if the deal goes through, we would have a very strong center of excellence for commodities in Oslo,” Nasdaq Nordic President Lauri Rosendahl told Reuters.
Euronext raised its bid for Oslo Bors to around 6.79 billion Norwegian crowns ($786 million), upping the stakes in a battle with Nasdaq for one of the last independent stock markets in northern Europe. The new offer valued the OSE at 158 Norwegian crowns per share ($18.29), compared with 152 Norwegian crowns in Nasdaq's previous offer.
Nasdaq raised its offer for Oslo Bors to 158 Norwegian crowns per share. Nasdaq’s offer thus becomes equal (in financial terms) to Euronext’s revised offer submitted on Feb. 11.
Norwegian Ministry of Finance approved both the Euronext and the Nasdaq's offers for the acquisition of the Oslo Bors, the Financial Times reported on Monday. The New York-based and Amsterdam-based stock exchange operators now have a six-month deadline for the purchase of 51% of shares.
Nasdaq withdrew its offer for Oslo Bors on Monday, Reuters reported, giving pan-European exchange Euronext free rein to pursue its bid for the Norwegian stock market operator after a five-month battle.
Euronext announced on Tuesday (June 4) that it now holds 61.4% of the Oslo Bors, after Nasdaq withdrew its bid last week. "As part of the Euronext family, Oslo Børs VPS will continue to be a strong and leading Nordic exchange and CSD, and will become the hub for Euronext’s ambitions in the region. We will now start working with the management and employees of Oslo Børs VPS to build our common strategy for the benefit of all stakeholders," Stéphane Boujnah, CEO and Chairman of the Managing Board of Euronext said in a statement.