Euronext Raising $2 Billion as Borsa Italiana Deal Completes

(Bloomberg) -- Euronext NV is looking to raise 1.8 billion euros ($2.2 billion) in a rights issue after completing the purchase of Borsa Italiana.

The stock exchange is offering 30.5 million shares at an issue price of 59.65 euros each, according to a statement Thursday. That will help fund the 4.4 billion euro acquisition of London Stock Exchange Group Plc’s Italian operation.

LSEG agreed to sell Borsa Italiana to Euronext and two Italian lenders in October, in a deal that creates the largest listing venue in Europe.

The closing of the transaction resolves months of tensions in Italy, including opposition from some members of the ruling parliamentary majority, on concerns that the deal was concentrating too much power in Paris and endangering one of the country’s “strategic assets.”

Euronext Chief Executive Officer Stephane Boujnah said on a call with reporters that the combination would have a strong Italian influence and that the group is planning to move a key data center from London to Italy.

“Italian voices will be heard at every level,” he said. “We have decided to migrate the core data center to Bergamo as a clear signal” of this.

Adding Borsa Italiana gives Euronext about a quarter of all equity trading in Europe, with 28 of the Euro Stoxx 50 companies listed on its markets. The deal means the exchange operator will derive more than a third of its sales in Italy, surpassing France as its largest revenue source. Euronext will also have a clearinghouse for the first time and gain a securities depository and bond platform.

Euronext also reported first-quarter earnings Thursday that beat analyst estimates. Earnings before interest, taxes, depreciation and amortization were 149 million euros and revenues rose 5.2% to 249 million euros.

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