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NYSE on track to purchase Euronext

Shareholders of NYSE Group Inc. approved the $14.6 billion

purchase of Euronext NV, paving the way for the creation of the first

trans-Atlantic securities market.

An estimated 99.7 percent of the NYSE Group shares voted were cast in favor

of the transaction, the exchange said in a statement yesterday. Euronext

shareholders on Tuesday backed the deal, scheduled to close in three months

after European regulators and the Dutch Finance Ministry gave conditional


NYSE Euronext will list companies with a total market value of $25.8

trillion, ranging from General Electric Co. to Sanofi-Aventis SA, and handle

about $100 billion in equity transactions a day along with options and futures.

The new company plans to increase profits by cutting $275 million in costs,

primarily through combining computer systems.

"The cultural aspects are as important as the technology integration," said

Philip Panaro, president of Manhattan-based IM2 Inc., a financial-services

consultant that advised Deutsche Bank AG and JPMorgan Co. on acquisitions.

"Announcing the acquisition is easy, completing the transaction is easy, but

doing the integration is hard, and sustaining shareholder value is harder."

The votes were a victory for NYSE Group chief executive John Thain and his

Euronext counterpart, Jean-Francois Theodore. They overcame a rival bid and

criticism from policy makers to prevail with their cash and stock deal. More

than 75 percent of eligible shares were voted yesterday during a meeting at the

New York Stock Exchange's former luncheon club. Final results will be made

available today, the company said.

NYSE Group's purchase of Euronext is the largest among almost $50 billion

of proposed mergers by exchanges worldwide in the last two years, according to

data compiled by Bloomberg News. Exchange operators are seeking combinations to

meet demand for low-cost electronic trading of securities across the world's

time zones.

The pace of consolidation has spurred Thain to consider expanding into

Asia, where many of the markets are still closely held or state-owned.

"Between China, Japan and India, one of those places will be the source of

some type of transaction," Thain said yesterday. "The structure is much more

likely to be minority shareholding positions, cross-holding positions or joint


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