Euronext and LCH.Clearnet Group Ltd. have recently been engaged in discussions regarding Euronext's investment in LCH.Clearnet, consisting of ordinary shares (representing 24.9% of LCH.Clearnet's fully-diluted share capital) and redeemable, convertible preference shares (representing 16.6% of LCH.Clearnet's fully-diluted share capital, which are redeemable under their terms in December 2008). The parties have reached an agreement in principle for the early redemption of all of the RCPS and the repurchase of ordinary shares held by Euronext such that it would retain only a 5% shareholding post-repurchase.
The RCPS would be redeemed at their redemption value of approximately €199M, plus accrued but unpaid dividends. The ordinary share repurchase would be based on a fully-diluted valuation of LCH.Clearnet's share capital of €1.2bn, which was the valuation at the time of Euronext's initial investment.
Any such transaction remains subject, among other things, to final agreement on detailed terms and, subsequently, to approval by LCH.Clearnet's shareholders and to regulatory and other appropriate consents.
