Euronext Detaches From ICE Through $1.2 Billion IPO

Euronext NV (ENX), the European stock exchange operator with roots in the 17th century, was untethered from Intercontinental Exchange Inc. (ICE) through an 845 million euro ($1.2 billion) initial public offering.

Shares of Euronext, owner of markets in Belgium, France, the Netherlands and Portugal, were sold for 20 euros apiece, according to a statement yesterday. The offering of 42.2 million shares was at the low end of the announced range of 19 euros to 25 euros. The stock started trading today using the “ENX” ticker. The company retreated 0.9 percent to 19.83 euros at 12:50 p.m. in Paris.

The spinoff unwinds what had been the first exchange operation to span the Atlantic Ocean. New York Stock Exchange owner NYSE Group Inc. bought Paris-based Euronext in 2007, renamed itself NYSE Euronext, and then sold to Atlanta-based ICE seven months ago. Euronext competes with pan-European market Bats Chi-X Europe as well as London Stock Exchange Group Plc and Deutsche Boerse AG.

“I foresee consolidation in the next two years” as Euronext also competes with exchanges in Madrid, Milan and the Nordics, said Tom Muller, analyst at Theodoor Gilissen Bankiers.

’Good Timing’

Euronext joins companies including TSB Banking Group Plc in listing this year, making it the busiest first half for IPOs in Europe since 2011, according to data compiled by Bloomberg.

Photographer: Jasper Juinen/Bloomberg

A statue stands in front of the AEX index curve as it is displayed on an electronic board inside the Amsterdam Stock Exchange, operated by Euronext NV, in Amsterdam. Close

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Photographer: Jasper Juinen/Bloomberg

A statue stands in front of the AEX index curve as it is displayed on an electronic board inside the Amsterdam Stock Exchange, operated by Euronext NV, in Amsterdam.

“This is good timing for the IPO as euro-zone economies have stabilized and could be at the cusp of a recovery,” said Christophe Nijdam, an analyst at AlphaValue SAS in Paris. Euronext’s management has a strategy of “prudent organic growth” and long-term investors see that as positive, he said.

Nijdam has a buy recommendation on the stock with a 12-month price target of 24 euros.

The IPO followed an earlier agreement by institutional investors -- including ABN Amro Group NV and BNP Paribas SA -- to buy 33 percent of Euronext at a 4 percent discount to yesterday’s offering price. That’s in addition to the 60 percent stake sold yesterday.

If the underwriters, who include ABN Amro Bank, JPMorgan Chase & Co. and Societe Generale SA -- accept all of 4.2 million shares made available through the over-allotment option, ICE will completely divest its Euronext stake.

Euronext, which won’t receive any IPO proceeds, reported revenues of 7.6 million euros in the quarter ended March. About 53 percent of its third-party revenue came from the cash trading and derivatives trading businesses, its prospectus said.

To contact the reporters on this story: Ruth David in London at rdavid9@bloomberg.net; Elco van Groningen in Amsterdam at vangroningen@bloomberg.net; Francesca Cinelli in Milan at fcinelli@bloomberg.net

To contact the editors responsible for this story: Nick Baker at nbaker7@bloomberg.net; Aaron Kirchfeld at akirchfeld@bloomberg.net; James Ludden at jludden@bloomberg.net Alan Soughley

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