NYSE and DB officials have been working on the politicians instead. The final decision is up to the 27 EU Commissioners, who will issue a final decision on February 9. The problem: the Commissioners rarely overturn the staff recommendations.
By the way, why did the stock spike up? In most mergers, the stock would go down. Likely reason: the NYSE may be worth more as a standalone company, and the stock price has been reflecting the increasing likelihood the deal would not be approved.
How so? Because the NYSE-DB deal is tied partly to the euro, which has been dropping dramatically for 3 months, while NYSE stock has moved sideways.
Do the math: NYSE shareholders get .47 times the Deutsche Boerse price of 40.39 euros, plus a 2 euro dividend if deal closes. With the euro at $1.27, the conversion price is about $25.30.
Since the deal was announced in February, the euro has been decimated: it was about $1.40, now at $1.27.
Bottom line: the deal is less compelling, because this is a double-down on Europe.
If the euro was where it was when the deal was announced, the conversion price would be $27.89 (around where the stock is trading now).
But wait a minute: the stock is trading at $27.60. It's already trading as if the deal had a lower chance of happening.
What is it worth alone? Rich Repetto at Sandler O'Neill thinks the company is worth $30 per share on a standalone basis.
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