The reverse termination fee, which would be paid by
the bidding party in event of a failure of the deal, came today
in the joint proposed merger agreement released by the two
hostile bidders and is intended to alleviate fears of the deal
being thrown out by US antitrust authorities.
In a highly charged statement, Nasdaq and ICE said
the deal would "strengthen investor confidence in US equity
markets" and, in a clear challenge to the Deutsche Börse
bid, added it would "preserve competition in the European
Jeffrey Sprecher, chairman and chief executive
officer of ICE, said, "Based on the feedback we have heard from
NYSE Euronextstockholders, we are more confident than ever that
the proposed NASDAQ OMX/ICE transaction is better for them, the
markets and the exchange's customers.
"We trust that the NYSE Euronext Board will seek to
enhance the value to its stockholders by meeting with us to
evaluate our superior proposal."
In addition, Nasdaq and ICE said that they had
$3.8bn financing in place for the bid from a syndicate of banks
including Bank of America, Nordea Bank, Skandinaviska Enskilda
Banken and UBS Investment Bank for the Nasdaq part of the bid
and Wells Fargo and Bank of America for ICE.
The board of NYSE Euronext unanimously rejected the
Nasdaq/ICE bid on 10 April citing concerns over the chance of
completion and reiterating its belief that the group should not
be broken up.
In a letter sent to Jan-Michiel Hessels, chairman
of the board of directors at NYSE Euronext, and included in
today’s statement, Nasdaq and ICE said: "We
believe your shareholders should be given the opportunity to
make the decision as to how best to allocate their interests in
As the Deutsche Börse deal is structured as an
all share merger, there is no requirement for the NYSE Euronext
board to seek the highest bid for the business. However, Nasdaq
and ICE are hoping that the premium on their bid will be enough
to provoke a shareholder rebellion over the acceptance of the
Deutsche Börse bid.
The letter said: "The agreement with Deutsche
Börse permits you to engage in discussions with us and
allow us to undertake our due diligence investigation of NYSE
Euronext if you believe that "there is a reasonable likelihood
that our proposal could constitute a Superior Proposal." In
this regard, you need not actually determine that our proposal
is, at this time, a Superior Proposal.
"There is no question that our proposal is
economically "Superior", indeed far superior, and we believe
your duty to be well informed requires that you discuss with us
any issues that could conceivably overcome this sharp
difference in the value of the two offers.
"By engaging with us, you will be enhancing your
ability, and the ability of your stockholders, to consider our
proposal, and you will also discover whether Deutsche Boerse
would improve its offer in response."
NYSE Euronext will hold its annual shareholder
meeting on the 28 April.