By Mathieu Rosemain
PARIS (Reuters) -Exchange operator Euronext said it withdrew its 5.5 billion euro ($5.82 billion) indicative offer to acquire fund distribution firm Allfunds on Tuesday.
Euronext, home to Paris, Amsterdam and Milan stock exchanges, did not elaborate on the reasons that led it to drop its cash-and-shares bid for Allfunds.
The exchange operator, which competes in Europe against bigger rivals Deutsche Boerse and London Stock Exchange Group, submitted a preliminary offer to buy Allfunds on Feb. 22 in a deal aimed at diversifying the firm.
According to a source close to the matter the deal was withdrawn because of its “inadequacy in terms of lack of synergies, drop in Euronext’s shares since the offer and the uncertainty of the proposed offer in its timing and financing”.
Shares of Euronext fell by 10% over the last week.
Allfunds board was poised to reject Euronext’s offer, the source had told Reuters before Euronext’s statement, speaking on condition of anonymity as the deal talks were private.
The fund distribution firm said in a statement that its board considered the terms of Euronext’s bid “inadequate.”
“Allfunds subsequently entered into discussions on terms with Euronext but no agreement was reached and discussions
have been terminated,” it said.
Euronext’s indicative offer for Allfunds amounted to 8.75 euros per share and consisted of 5.69 euros per share in cash plus 0.04059 new shares.
While the offer had valued the Madrid-based Allfunds above its market cap of 4.6 billion euros at the time, it was still below the 7.2 billion euros the distribution firm reached in its Amsterdam listing in 2021.
Over the past few years, Euronext has been involved in a series of acquisitions, including the integration of the Milan bourse, which it bought in a 4.4 billion euro deal in 2021.
Hellman & Friedman is Allfunds’ largest shareholder with a 34.3% stake, while BNP Paribas controls 12.1%. Credit Suisse sold an 8.6% stake in Allfunds in October last year.
($1 = 0.9454 euros)
(Reporting by Mathieu Rosemain; Additional Reporting by Urvi Dugar in Bengaluru; Editing by Leslie Adler, Bill Berkrot and Himani Sarkar)
