Euronext has closed a share swap of its 2.3 per cent stake in LCH Group for an 11.1 per cent stake in LCH SA, becoming minority shareholder in the business in the process.
Following the swap, Euronext will maintain representation at the Board of Directors of LCH SA and will have certain minority protection rights connected with its new shareholding in the company, including a pre-emption right in circumstances where LCH Group decides to sell more than 50 per cent of the shares of LCH SA. The pre-emption right involves a right of first offer and subject to certain conditions, a matching right.
In addition, LCH Group has a pre-emption right over a transfer of shares by Euronext and the ability to buy back Euronext’s shares in certain circumstances where the derivatives agreement is terminated.
Euronext will record a gross capital gain of EUR40.6 million in exceptional financial income as a result of the share swap, estimated at EUR38.4 million after tax. This capital gain will be accounted for in the 2017 fiscal year and will be taken into account for the computation of 2017 dividend.