Jan 21 (Reuters) - Deutsche Boerse on Wednesday reached a deal to acquire Allfunds at a valuation of 5.3 billion euros ($6.19 billion), it said in a statement. Deutsche Boerse would pay 8.8 euros for
Deutsche Boerse's €5.35 Billion Acquisition of Allfunds Boosts Shares
Deutsche Boerse's Strategic Acquisition of Allfunds
By Kanjyik Ghosh
Jan 22 (Reuters) - Deutsche Boerse's record 5.35 billion euro ($6.25 billion) deal to buy Amsterdam-listed fund trading platform Allfunds pushed the German stock exchange operator's shares up 3.2% at market open on Thursday.
Acquisitions are a major part of Deutsche Boerse's strategy, and the deal is its largest ever, surpassing its 3.9 billion euro purchase of Danish investment management software company SimCorp in 2023.
Details of the Acquisition
Announcing the deal late on Wednesday, Deutsche Boerse CEO Stephan Leithner said that the acquisition was part of the company's efforts to become a European champion in providing critical infrastructure for financial markets.
Market Reaction and Share Performance
'A DEAL WITH STRONG STRATEGIC RATIONALE', JEFFERIES SAYS
Future Expectations and Synergies
The German firm offered 6 euros in cash plus 0.0122 Deutsche Boerse shares for every Allfunds share, it said, adding that the Amsterdam-listed firm's shareholders would also receive a dividend of 0.20 euro.
Allfunds shares opened up 3.9% on Thursday.
"This is a deal with a strong strategic rationale ... and should be welcomed," analysts with Jefferies said.
Allfunds shares closed at 7.96 euros on Wednesday ahead of the deal's announcement, ending the trading day at a valuation of about 4.79 billion euros, according to LSEG data. Deutsche Boerse had a valuation of 39.41 billion euros as of Wednesday, according to LSEG data.
The deal values each Allfunds share at 8.8 euros, a premium of 32.5% from the closing price on November 26. The two firms entered exclusive talks for an acquisition the next day, sending shares up over 22%.
The German exchange operator said it expected annual run-rate pre-tax cost synergies of approximately 60 million euros along with annual run-rate cash savings on capex of approximately 30 million euros. The company expects to deliver about 50% of the total synergies by the end of 2028, it added.
U.S. technology investor Hellman & Friedman and French bank BNP Paribas are the largest shareholders in the Anglo-Spanish firm, which went public in 2021.
Deutsche Boerse said it expected the deal to close in the first half of 2027.
In recent years, the Swiss stock exchange SIX and the French exchange Euronext had expressed interest in acquiring Allfunds. However, Euronext withdrew its takeover bid of approximately 5.5 billion euros almost two years ago.
($1 = 0.8556 euros)
(Reporting by Kanjyik Ghosh in Barcelona; Additional reporting by Tom Sims in Frankfurt; Editing by Nick Zieminski, Lisa Shumaker and Joe Bavier)
