Securities Law Prof Blog

Editor: Eric C. Chaffee
Univ. of Toledo College of Law

Tuesday, April 19, 2011

NASDAQ/ICE Prepared to Pay $350 Million Reverse Termination Fee

NASDAQ and ICE increased the pressure on NYSE Euronext by announcing additional steps they have taken to "demonstrat[e] their commitment to pursuing their superior proposal with NYSE Euronext and providing greater certainty to the NYSE Euronext Board:"

  • A proposed merger agreement has been submitted to the NYSE Euronext Board that is consistent with the terms of the current business combination agreement with Deutsche Boerse;
  • NASDAQ OMX and ICE are prepared to pay a reverse termination fee of $350 million (USD), in the event that they are unable to obtain necessary antitrust and competition approvals;
  • NASDAQ OMX and ICE have received fully committed financing of $3.8 billion from a group of leading institutions; and
  • Actions necessary to start the U.S. antitrust review processes have been taken and those reviews are expected to commence shortly.

The release also stated that "[t]he NASDAQ OMX/ICE proposal remains superior by a significant and inescapable margin. Based on April 18th closing prices, the NASDAQ OMX/ICE proposal outlined in the proposed merger agreement is valued at $42.67 per NYX share. This is 21%, or $2 billion, above the $35.29 value per NYX share under the Deutsche Boerse transaction."

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