Euronext Says Covid-19 Changes M&A Market


Stéphane Boujnah, chief executive of Euronext, said some sellers are becoming more flexible and the mechanism of acquisitions is changing due to the volatility caused by the Covid-19 pandemic.

Stéphane Boujnah, Euronext

Boujnah spoke this morning on Euronext’s results call for the first quarter of this year.

He continued that the pan-European exchange operator is continuing to look at acquisitions to meet its ambitions for growth and to diversify revenues away from trading.

Last month Euronext announced the acquisition of of VP Securities, the Danish central securities depository.

“We are monitoring other situations and are having some dialogues but in most of these, nothing happens,” Boujnah said.

He continued that the fall in prices during the pandemic means some sellers are becoming more flexible, although there are not yet any distressed sales and there are likely to be fewer open auctions.

“The grammar and choreography of doing deals is changing,” Boujnah added. “This creates opportunities for us as we are agile and can take part in bilateral processes.”

He continued that disposals of market infrastructures owned by bank consortiums present a good opportunity.

“There were sales after the global previous crisis so we expect others,” said Boujnah. “This a spot where Euronext wants to be.”

VP Securities

In a market infrastructure deal, Euronext has announced it intention to acquire the Danish CSD. Boujnah described the deal as a new major milestone in Euronext building a pan-European market infrastructure following the acquisitions of Oslo Børs VPS and Nord Pool

“It will double our CSD business size, further improving our revenue mix and increasing the share of non-volume related revenue,” he added.

In 2018 trading made up 45% of group revenues and last year, on a pro forma basis, this would have reduced to 36%.

2019 Pro Forma Revenue. Source: Euronext

Boujnah continued that VP Securities lacked scale and shareholder support for growth projects.

“VP Securities shares technology with VPS in Oslo and the companies know each other well,” he added. “They have previously discussed joint offerings.”

He said there is an opportunity to monetise data from the two Nordic CSDs as there is a demand to have more information on the behaviour of the asset owners.


Giorgio Modica, chief financial officer, said on the call that all asset classes experienced a double-digit increase in trading revenues in the first quarter and post-trade revenues doubled due to the consolidation of the Norwegian VPS CSD.

Total trading revenue increased 73.3% to €111.8m with double digit growth across all asset classes and Nord Pool power trading contributing €7.2m. The exchange said like-for-like trading revenue increased 54.9% in a highly volatile environment.

Boujnah said:  “The group reported a cash trading market share at 69.9% which highlights the important role of transparent market venues ensuring fair and orderly markets under extreme market conditions. This quarter’s solid performance demonstrates the resilience of our operating model and validates the investments over the past four years in developing our state of the art proprietary trading platform Optiq.”